How to protect your EDP records;

              RELIANCE ON OTHER AUDITORS
UNITED STATES PRACTICE
by Raymond E. Perry
The auditor's report on the financial statements of
a business is sometimes based on the work of
more than one auditor. In the typical situation one
of the auditors, called the primary auditor, as­sumes
the responsibility for issuing an audit report
based, in part, on work performed by one or more
secondary auditors. The primary auditor may or
may not refer to the secondary auditor in his
report, depending on the circumstances of the
engagement.
The employment of a secondary auditor may be
initiated by either the primary auditor or the man­agement
of the company. The secondary auditor's
work may be a complete examination in accord
with generally accepted auditing standards or it
may involve only specified and limited procedures.
For example, the secondary auditor may be em­ployed
to audit an autonomously operated subsidi­ary
company, or he may be employed merely to
observe the taking of a physical inventory.
In most cases the accounts audited by the sec­ondary
auditor will be combined or consolidated
with the accounts audited by the primary auditor,
and the financial statements audited by the sec­ondary
auditor will not appear separately in the
report. This is usually the case when the secondary
auditor is employed to verify specific accounts at
distant locations, or to audit a consolidated sub­sidiary
or unincorporated division. At other times
the secondary auditor may be employed to audit
the accounts of an unconsolidated subsidiary, in
which case the financial statements of that sub­sidiary
would be presented in the report separately
from those of the parent company and any con­solidated
subsidiaries.
Secondary auditors are most often engaged in
either of two situations. A business may employ a
secondary auditor when it has operations located
at a distance from the closest office of the primary
auditor—whether in the primary auditor's country
or in a foreign country.
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