Acams Advanced-CAMS-Audit Exam - Topic 4 Question 38 Discussion

Question

During the interview, the local director informs the audit manager that no internal or regulatory audits have occurred since the local director's appointment The local director relies on a locally-approved independent external review of Company A performed 12 months ago by a local firm How should the audit manager respond?

Kathrine · Accepted Answer

B) Review the independent external review report to determine the extent to which reliance can be placed on it and identify matters requiring further review by internal audit.

Kathrine · Answer

A) Validate the accuracy of content of the independent external review report by recommending an audit and assess if the findings of both the independent review and audit are similar.

Kathrine · Answer

C) Rely upon the independent external review report as the base to formulate conclusions of the current onsite visit by internal audit.

Kathrine · Answer

D) Advise the group board that the group should set aside the external review reports as the use of the third party independent reviewer was not authorized at group board level.
  Steps to Assess the External Review Report:
Validate the scope, methodology, and findings of the external review to determine its adequacy and reliability.
Identify any gaps or areas that require additional scrutiny by internal audit.
  Rationale for Review Instead of Reliance:
Relying solely on external reviews without validation risks overlooking key compliance deficiencies. Internal audit must establish an independent assessment to corroborate findings.
  CAMS-Audit Recommendations:
CAMS-Audit stresses the importance of critical evaluation of third-party reports and ensuring internal audit findings align with organizational compliance priorities