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Group and transnational audits

3.3 Understand the component auditor

The group auditor should obtain an understanding of:

 Whether the component auditor understands and will comply with the code of
ethics.

 The professional competence of the component auditor.

 Whether the group auditor will be able to be involved in the work of the
component auditor.

 Whether the component auditor operates in a regulatory environment that
actively oversees auditors.

If the group auditor has any doubts about the component auditor or their ability to do
the work the group auditor should obtain the audit evidence in respect of the
component directly.

3.4 Materiality

The group auditor is responsible for establishing:

 Materiality and performance materiality for the group financial statements as a
whole.

 Materiality for components where they are to be audited by other auditors.

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