ABC and Associates, Certified Public Accountants, audits the financial statements of XYZ, Inc. During the audit, ABC engaged Eric and Evan LLP, a London, England public accounting firm, as a component auditor to audit XYZs wholly owned English subsidiary.

a. Should ABC make reference to the component auditor in its audit report? Explain.

b. Assume that Eric and ABC issued a qualified report on the English subsidiary. Should ABC include the same qualification in its report on Jordan Toys?