Page 45 - CA Final PARAM Digital Book.
P. 45
Part 5 - SA 402
Understanding Services Given by SO Old Course – (M06E, M11E, M12M, N12R, N13E, N14R, M16R,
QNO
52.000 TITANIUM CNO--SA402.140 PM17, M17R, N18R, N18M, N19M)
New Course – (SM23)
In the course of audit of Raja and Rank Ltd, the audit manager of Sharma & Co observed that Raja and
Rank Ltd has outsourced certain activities to an outsourcing agency.
(a) As the engagement partner, guide the audit manager in the assessment of services provided by the
outsourcing agency in relation to the audit
(b)What are sources of information for understanding SO services.
(c) Discuss the procedure to be applied in case the user auditor is enable to obtain a sufficient
understanding from the user entity?
OR
MNO Ltd. gets its accounting data processed by a service organisation. CA Riya is the statutory auditor of
MNO Ltd. CA Riya wants to obtain an understanding as to how MNO Ltd. is using the services of the service
organisation. What all understanding should she obtain?
Answer Part I -- Relevant Standards & Laws
▪ SA 402, Audit Considerations relating to an Entity Using a Service Organisation
Part II -- Requirements of Relevant Standards & Laws
SA 402 / SAE 3402
SA 402 SAE 3402
Applicable Applicable
USER AUDITOR
SO
AUDITOR
SALARY PROCESSING IS
OUTSOURCED
USER ENTITY
SERVICE
ORGANISATION
www.auditguru.in PARAM 2.24 | P a g e
