Using the Work of explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
SA 600 applies when one auditor signs the report on an entity's financial information but part of that information, such as a branch or subsidiary, is audited by someone else. It explains when the signing auditor can act as the principal auditor, what must be done before relying on the other auditor, and how the report should describe the split.
SA 600, as effective for audits relating to accounting periods beginning on or after 1 April 2002, is the text in force (issued April 1995 and revised September 2002). ICAI may revise standards, so check icai.org for the current text. A revision of SA 600 has been proposed; readers should check whether it has been notified before relying on this text for a later period. Multi-location companies often pair this with financial and legal due diligence style reviews of their branch records.
The principal auditor first decides whether their own participation is sufficient to act as principal auditor, looking at materiality of the portion audited, knowledge of the components, risk and extra procedures (paragraph 9). The principal auditor must then obtain sufficient appropriate evidence that the other auditor's work is adequate, consider significant findings, and document the work. If the work cannot be used and enough extra procedures cannot be done, the opinion is qualified or disclaimed (paragraph 22). Where the report relies on others, it states the division of responsibility (paragraph 25).
Scope and terms (paragraphs 1-8)
Paragraph 1 recalls the principle in SA 200 (the older basic principles text) that an auditor who uses the work of other auditors continues to be responsible for forming and expressing an opinion, though entitled to rely on others if skill and care are used and there is no reason to believe reliance is wrong. It adds that where an independent statutory appointment supplies the work, such as branch auditors appointed under the Companies Act, 1956, the report should state the fact of reliance. The printed text refers to the 1956 Act; the Companies Act, 2013 now applies and the auditor's powers and duties under section 143 are covered in our section post.
The standard does not apply to joint auditors (see SA 299) or to the relationship with a predecessor auditor (paragraph 3). It does not apply where a component's information is immaterial, but several components that are immaterial individually but material together call for the procedures to be considered (paragraph 4). The principal auditor decides how the other auditor's work will affect the audit (paragraph 5).
| Term | Meaning (paragraphs 6-8) |
|---|---|
| Principal auditor | The auditor responsible for reporting on the entity's financial information that includes components audited by another auditor |
| Other auditor | An auditor, other than the principal auditor, responsible for reporting on a component's information included in the principal auditor's work |
| Component | A division, branch, subsidiary, joint venture, associated enterprise or other entity whose information is included |
Acceptance as principal auditor (paragraph 9)
The auditor considers whether their own participation is enough to act as principal auditor, by looking at:
- how material the portion that the principal auditor audits is;
- the principal auditor's knowledge of the business of the components;
- the risk of material misstatement in components audited by the other auditor; and
- the additional procedures under this SA that give the principal auditor significant participation in that audit.
The principal auditor's procedures (paragraphs 10-18)
| Point | What the text says | Paragraph |
|---|---|---|
| Right to visit | Where the governing statute gives a right to visit a component and examine its books, the principal auditor can normally rely on the other auditor unless special circumstances make a visit essential | 10 |
| Competence | If the other auditor is not a member of ICAI, consider their professional competence for the specific assignment | 11 |
| Evidence of adequacy | Obtain sufficient appropriate evidence that the other auditor's work is adequate for the purpose | 12 |
| Planning arrangements | Tell the other auditor how the work and report will be used and arrange co-ordination at planning (areas for special consideration, identifying inter-component transactions, timetable) | 12(a) |
| Requirements | Advise the other auditor of significant accounting, auditing and reporting requirements and obtain a representation on compliance | 12(b) |
| Checking the work | May discuss the procedures applied, review a written summary such as a questionnaire or checklist, or visit; extent depends on the circumstances and knowledge of the other auditor's competence | 13 |
| Quality control | May decide such procedures are unnecessary if sufficient evidence shows acceptable quality control policies are followed in the other auditor's practice | 14 |
| Findings | Consider the other auditor's significant findings; may discuss with the other auditor and component management, and require supplemental tests | 15-16 |
| Non-professional auditor | Where the other auditor is not a professionally qualified auditor, for example some foreign components, paragraphs 10-16 assume added importance | 17 |
Documentation (paragraph 18)
The principal auditor documents the components audited by others, their significance to the whole, the names of the other auditors, any conclusions that components are immaterial, and the procedures performed and conclusions reached, including the results of discussions and review of summaries. Reasons for limiting procedures under paragraph 14 need not be documented separately if summarised elsewhere. If the other auditor's report is not unmodified, the principal auditor documents how the qualifications or adverse remarks were dealt with in framing the principal auditor's own report.
Co-ordination (paragraphs 19-21)
There should be sufficient liaison between the principal and other auditors, and the principal auditor may issue written communications. The other auditor, knowing how the work will be used, co-ordinates: bringing significant findings for entity-level treatment to the principal's immediate attention, keeping to the timetable, and complying with statutory requirements. The principal likewise tells the other auditor of matters that may have an important bearing on the other's work. The principal may require the other auditor to answer a detailed questionnaire, and the other auditor must reply on time.
Reporting considerations and division of responsibility (paragraphs 22-25)
| Situation | Effect | Paragraph |
|---|---|---|
| Work cannot be used and enough extra procedures cannot be done | Qualified opinion or disclaimer because of a scope limitation (see SA 705) | 22 |
| Other auditor issues or plans to issue a modified report | Consider whether the matter is serious enough, relative to the entity's information, to need modification of the principal's report | 23 |
| Normal reliance | Principal is not responsible for the work entrusted to others, except where circumstances should have aroused suspicion about its reliability | 24 |
| Opinion relies on reports of other auditors | The report states clearly the division of responsibility, for example the number of divisions, branches or subsidiaries audited by others | 25 |
Paragraph 24 is a limit on responsibility, not a licence to ignore red flags. See SA 700 part 2 for the elements of the auditor's report and SA 610 for reliance on internal auditors, which is a different subject.
For companies, branch audit and the auditor's report on branch audit are dealt with in Rules 11 and 12 of the Companies (Audit and Auditors) Rules, 2014. For the tax audit perspective, see branch auditors and foreign branches in tax audit.
Illustrative example
Meridian Engineering Ltd is an invented company; all figures are illustrative. The statutory auditor audits the head office and three plants. Two branches, forming about one-fifth of turnover, are audited by Firm B, and a foreign branch by a local auditor who is not an ICAI member. The statutory auditor decides its own participation is enough, asks about Firm B's reputation and competence, sends instructions on accounting policies and inter-branch transactions with the timetable, and gets a representation of compliance. It reads the questionnaire replies and discusses the findings with Firm B. For the foreign branch, where the auditor is not professionally qualified, it adds a visit and supplemental tests. Firm B's report has an emphasis on a litigation matter, so the statutory auditor considers whether it needs reflection in its own report. Its report states that branches audited by others contribute a stated proportion of the total.
Need help with multi-location audits?
Companies with branches and subsidiaries audited by different firms are asked for consistent policies, timetables and a list of inter-unit transactions. TaxClue's financial and legal due diligence team can help you review branch and subsidiary records and bring them into one reporting pack before the audit begins.
Key takeaways
- The principal auditor must be satisfied that their own participation is sufficient.
- Reliance on another auditor needs evidence that the work is adequate, not just a copy of the report.
- The extent of procedures depends on the other auditor's competence and quality control.
- The report states the division of responsibility when relying on others.
- A modified report by the other auditor must be considered for its effect on the principal's report.
Read next
- SA 299: joint audit
- SA 610: using the work of internal auditors
- SA 620: using an auditor's expert
- SA 710: comparative information
Disclaimer: Based on the Standards on Auditing and quality standards issued by the Institute of Chartered Accountants of India, in the versions named in the article, and ICAI's announcement of 31 March 2026 on SQM 1 and SQM 2, as consulted on 3 October 2026. ICAI revises standards from time to time; check the current text and effective dates on icai.org. This article is general information, not legal advice; check the official text before acting.