- 10 Marks
AA – Nov 2018 – L2 – Q2a – Internal Audit and Its Relationship with External Audit
Discusses the advantages and disadvantages of outsourcing the internal audit function compared to maintaining an in-house team.
Question
a) Proper Banking Limited (PBL) has been trading for 20 years selling banking products and has recently become a listed company. In accordance with corporate governance principles of Bank of Ghana, PBL maintains a small internal audit department. The board of directors feels that the authorized business of the Company is banking which is core to the success of PBL. On 20 November 2017, the Operational and Governance Committee of the Board met to discuss whether to maintain the internal audit department and increase its size and build its expertise or to outsource the whole function to their external auditors, International & Co with headquarters in Accra, Ghana, with a global presence in over ninety-nine (99) countries.
Required:
Advise the Board of PBL on the advantages and disadvantages of whether to outsource or maintain their internal audit function. (10 marks)
Find Related Questions by Tags, levels, etc.
- Tags: Audit Costs, Audit Staffing, Confidentiality, Internal Audit, Internal Control, Outsourcing
- Level: Level 2
- Topic: Internal Audit and Its Relationship with External Audit
- Series: NOV 2018