Calvin Kleene is a manufacturer and distributor of fashion clothing to retail stores on credit terms. Its year-end was 31 March 2021. You are the senior auditor assigned to the year-end audit that is due to commence shortly. It was brought to your attention that Calvin Kleene receives monthly statements from its suppliers and although these have been retained, none have been reconciled to the payables ledger as at 31 March 2021.

Calvin Kleene uses an accounting software to process and prepare it financial accounting statements. The audit engagement partner has asked you to recommend the procedures to be performed on supplier statements despite routine internal audits.

Required:

1. Explain THREE (3) factors the external auditor will need to take into consideration when determining whether the work of the internal auditor can be used as audit evidence.

(3 marks)