Thesis (M.Sc.) - Cairo University - Faculty of Commerce - Department of Accounting

Public company accounting oversight board (PCAOB) auditing standard no. 5 allows the external auditor to rely on the internal audit function when the internal audit activities meet certain criteria and the external auditors would find efficiencies in relying on their work. This paper examined the factors affecting the external auditors{u2019} reliance on the internal audit function and its impact on audit efficiency. Also, it identifies whether it is better for the external auditors to rely on the internal auditors{u2019} work already performed or to use the internal auditors as assistants. The results of the statistics showed that many factors are affecting the external auditor reliance on the internal audit function, but the competence and due professional care factor has the highest impact on the degree of the external auditor reliance on the internal audit function. We conclude that the percentage of the auditors who are convinced with the use of internal auditors work already performed is very large (77%).while the percentage of external auditors using the internal auditors as direct assistants is 23%

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