Nazim Kali, the auditor-in-charge of Valo, a Brazilian mining company, was reviewing the expert's report on the valuation of reserves for the world's largest bauxite deposits. The mining plans of Valo have met with strong criticism from scientists, environmentalists, and the Brazilian population.
The bauxite operations had required the use of local auditors of another international public accounting firm. The group engagement partner, Lori Lake, met with Nazim to discuss the reliance their firm would be placing on the component auditors. She was concerned that the component auditors conclusions were not based on adequate evidence. The financial statements being audited by the component auditors are a material part of the consolidated statements of Valo.
Required:
a) What role does Nazim have in assessing the expert's report on the bauxite deposits?
b) What role does Nazim and his firm have before they make a decision to use the work of another auditor?
c) What is the engagement partner's role once her firm has assigned the work to a component auditor?

Question

Quizplus · Accepted Answer

The Answer of Nazim Kali, the auditor-in-charge of Valo, a Brazilian mining company, was reviewing the expert's report on the valuation of reserves for the world's largest bauxite deposits. The mining plans of Valo have met with strong criticism from scientists, environmentalists, and the Brazilian population.
The bauxite operations had required the use of local auditors of another international public accounting firm. The group engagement partner, Lori Lake, met with Nazim to discuss the reliance their firm would be placing on the component auditors. She was concerned that the component auditors conclusions were not based on adequate evidence. The financial statements being audited by the component auditors are a material part of the consolidated statements of Valo.
Required:
a) What role does Nazim have in assessing the expert's report on the bauxite deposits?
b) What role does Nazim and his firm have before they make a decision to use the work of another auditor?
c) What is the engagement partner's role once her firm has assigned the work to a component auditor?

Nazim Kali, the Auditor-In-Charge of Valo, a Brazilian Mining Company