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QNO Joint Audit-Advantages- Disadvantages Old Course -- (P16M/N19R/SM20/SM21/M23M)
299.01 Bhaskar CNO - SA299.020 New Course -- (SM25)
The practice of appointing Chartered Accountants as joint auditors is quite widespread in big companies
and corporations. Explain stating the advantages of the joint audit.

OR
Explain the concept of joint audit. Discuss its advantage and disadvantage
Answer ➢ Joint Audit:
The practices of appointing chartered accountants as joint auditors is quite widespread in big
companies and corporations, joint audit basically implies pooling together the resources and
expertise of more than one firm of auditors to render an expert job in a given time period which
may be difficult to accomplish acting individually. It essentially involves sharing of the total work.

When more than one auditor is appointed to audit large entities, such auditors are called joint
auditors. Joint auditors have a collective responsibility to report on the financial statements.

SA 299, “Joint Audit” deals with duties, rights and professional responsibilities of joint auditors.
The joint auditors should follow the principles of division of work and coordination while conducting
joint audits.

➢ “Advantages” of Joint Audit
Pooling and sharing of expertise.
Lower workload.
Advantage of mutual consultation.
Better quality of work performance.
Improved service to the client.
Lower staff development costs.
Lower costs to carry out the work.
A sense of healthy competition towards a better performance.

Special Point
Displacement of the auditor of the company in a take-over often obviated.
In respect of multinational companies, the work can be spread using the expertise if the
local firms which are in a better position to deal with detailed work and the local laws and
regulations.

➢ Disadvantages” of Joint Audit
Psychological problem where firms of different standing are associated in the joint audit.
General superiority complexes of some auditors.
Lack of clear definition of responsibility.
Problems of coordination of the work.
Areas of work of common concern being neglected.
The fees being shared.
Uncertainty about the liability for the work done.

QNO Developing the joint audit plan Old Course-- (M20R/N19E/SM20/SM21)
299.03 Bhaskar CNO - SA299.040 New Course – (SM25/S24M)
"Before the commencement of audit, the joint auditors should discuss and develop a joint audit plan."
Discuss the points to be considered in developing the joint audit plan by the joint auditors.
OR
PQR & Associates and MNO & Co., both firms of Chartered Accountants, have been appointed as joint
auditors of Gama and Beta Limited. Before the commencement of the audit, the joint auditors should
discuss and develop a joint audit plan. In developing the joint audit plan, the joint auditors should identify
division of audit areas and common audit areas.
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