ACCA Advanced Audit and Assurance (AAA) Practice Exam

What is the primary role of a service auditor?

1. To audit user entity financial statements

2. To provide assurance on controls of a service organization

3. To oversee the audit process for all entities

4. To evaluate the risk of audit evidence

The correct answer is: To provide assurance on controls of a service organization

The primary role of a service auditor is to provide assurance on the controls of a service organization. This involves assessing and reporting on the effectiveness of the internal controls that a service organization has in place to ensure that they are functioning as intended. Service auditors typically conduct audits based on frameworks such as SSAE 18, which focuses on service organizations that handle data or processes on behalf of client entities. By executing this role, a service auditor helps user organizations understand the level of risk associated with outsourcing services, such as data processing or cloud storage, by providing insights into how well the service organization manages its controls and mitigates potential risks. This assurance is crucial for user entities when they are making decisions about relying on third-party services. The other options relate to different auditing functions. For example, auditing user entity financial statements pertains to the responsibilities of independent auditors rather than service auditors, and overseeing the audit process for all entities is more aligned with the role of audit managers or partners. Additionally, evaluating the risk of audit evidence is part of the auditor's overall assessment during any audit engagement, not specific to service auditors. Thus, the focus of a service auditor is inherently different, distinctly placing emphasis on the controls of service organizations.