Question: An internal audit function has agreed to conduct an advisory consulting engagement related to evaluating the efficiency of a process. During this engagement, an internal

An internal audit function has agreed to conduct an advisory consulting engagement related to evaluating the efficiency of a process. During this engagement, an internal auditor identifies a control weakness that could be material to the company.

Required:

2.1 Since a consulting engagement is between two parties - the customer and the auditor - is there any obligation to disclose this weakness to senior management and the audit committee? (10 points)

2.2 What are the benefits and drawbacks of an internal auditor communicating such a weakness?

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