The Group Auditors Decide Not to Refer to the Audit

question 62

Multiple Choice

The group auditors decide not to refer to the audit of component auditors who audited a subsidiary of the group financial statements. After making inquiries about the component auditors' professional reputation and independence, the group auditor most likely would

• A)document in the engagement letter that the group auditors assume no responsibility for the component auditors' work.
• B)obtain written permission from the component auditors to omit the reference in the group auditors' report.
• C)contact the component auditors' and review the audit programs and working papers pertaining to the subsidiary.
• D)add an other-matter paragraph to the group auditors' report indicating that the subsidiary's financial statements are not material to the consolidated financial statements.

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