Joint Audit: When It Applies and How Responsibilities Are Shared

A joint audit is an audit of one entity's financial statements by two or more auditors who together issue the auditor's report. They divide the work between them, each answers for their own part, and some duties stay shared. It is common for large entities, either because the owners choose it or because a law or regulation requires it.

Last reviewed: 17 October 2026. Facts checked. We opened a published copy of the exposure draft of SA 299 (Revised), Joint Audit of Financial Statements, on TaxGuru. That is a draft with blanks and cut-off sentences, not the final ICAI text, so the rules below should be checked against the final standard. We ran searches on Section 139(3) of the Companies Act and found no page showing its text. We opened a Section 139 explainer that does not discuss joint audit. So we make no statement of what that section says. We read a news summary of an ICAI 2018 advisory on bank joint audits and did not open the advisory.

What joint audit means

In a single audit, one firm signs the report. In a joint audit, two or more firms do. They work from a shared plan and sign a common report, unless they disagree. The draft describes joint auditors as auditors appointed to jointly issue the auditor's report.

When it applies

From the draft standard: joint audit is common for large entities, either by shareholders' choice or because law or regulation requires it. We could not confirm the specific statutory basis for companies, so check the appointment provisions of the Companies Act and any rules or directions that apply to your client's sector. For banks, joint auditors are common, and ICAI has issued an advisory on how work is allocated. The news summary says the advisory stressed that allocation should be in agreement with the bank's management.

If you are unsure whether your client needs joint auditors, ask three questions:

1. Does the law, a regulator or the appointing authority require them?
2. Did the company's members or board resolve to appoint more than one auditor?
3. Does the appointment letter or resolution name more than one auditor?

How the work is divided

The draft says joint auditors divide the work by mutual discussion:

• Usually by identifiable units or specified areas.
• If that is not practical, by items such as assets, liabilities, income or expenditure.
• Some areas, because of their importance or nature, are covered by all.

Before the audit starts, they agree a joint audit plan that identifies divided and common areas. The draft says the allocation should be documented and signed, and passed to those charged with governance, because it helps avoid disputes among the auditors and with the entity.

A sample allocation might look like this (illustrative):

Who is responsible for what

The draft separates individual responsibility from joint responsibility.

Individual responsibility. Each auditor is responsible only for the work allocated to them, including its proper execution. Each decides the nature, timing and extent of procedures in their own area, evaluates controls and risks there, and obtains and evaluates management's information and explanations. For branches assigned to them, each reviews branch auditors' reports and decides whether to visit.

Joint responsibility. All joint auditors are jointly and severally responsible for:

• Work not divided among them and performed by all.
• Decisions on the nature, timing and extent of procedures for common areas. The application guidance says this covers whether those decisions are appropriate, not the execution.
• Matters raised by one auditor that the others have agreed on.
• Compliance of the financial statements with statutes, and their presentation and disclosure.
• Compliance of the auditor's report with statutes, the SAs and ICAI pronouncements.

The practical lesson is that a clean split of work does not create a clean split of responsibility. For the report and for the statements as a whole, you are in it together.

What each auditor must do

From the draft:

1. Assess and document the risks of material misstatement, and communicate them to the other auditors.
2. Communicate in writing, before the audit is completed, any matters relevant to the other auditors' areas.
3. Discuss and document procedures for common and allocated areas, and communicate them to those charged with governance.
4. Discuss and communicate conclusions with each other before finalising the report.
5. Tell those charged with governance about any expected modification, or emphasis of matter or other matter paragraph.
6. Issue a common report unless there is disagreement. A dissenting auditor issues a separate report and refers to the other reports in an Other Matter paragraph.

The draft also says each auditor may assume the others did their work to the standards and reported any significant departures, and does not have to repeat it. Where one auditor audits a division or branch, the others may rely on those statements.

Our posts on SA 706 paragraphs and SA 705 modifications explain what a dissent and an expected modification involve.

Common engagement documents

The draft says joint auditors should obtain a common engagement letter and a common management representation letter. Using one letter avoids two sets of terms. Use an engagement letter template as a base and add the joint audit plan as a schedule.

Setting up a joint audit well

1. Meet early. Agree the allocation before fieldwork.
2. Write it down. One signed allocation document.
3. Share risks. A risk that sits in your area may affect a common area.
4. Set a communication routine. Weekly updates, one shared list of open points.
5. Agree the review. Who reviews common areas, and how conclusions are reached.
6. Plan the report. Draft the common report together and agree the timetable.
7. Plan fees. Agree how fees are shared and how scope changes are handled.
8. Keep your own file. Your working papers must show your allocated work and your communications.

Pitfalls

• Work split by habit, not by risk.
• No joint plan.
• Findings not shared, so one auditor learns of a problem at the report stage.
• Assuming a split means a split of liability.
• No agreed route if one auditor wants to modify and the other does not.

Frequently Asked Questions

What is a joint audit?

An audit of one entity by two or more auditors who are appointed to issue the auditor's report together.

Are joint auditors responsible for each other's work?

Each is responsible for their own allocated work. They are jointly and severally responsible for common areas, the compliance of the statements and the compliance of the report, according to the draft SA 299 we read.

What if joint auditors disagree on the opinion?

Per the draft, a dissenting auditor issues a separate report and refers to the others' reports in an Other Matter paragraph.

Do banks use joint audit?

Joint auditors are common in bank audits. See our guide to bank audits. We did not open ICAI's advisory on work allocation in bank audits.

Do joint auditors need a common engagement letter?

The draft says they should obtain a common engagement letter and a common management representation letter.

Related Articles

• Statutory audit explained
• Bank audit guide for CA firms
• Types of audit opinion in India
• Form ADT-1: auditor appointment

Statutory facts on this page are checked against their sources, and the page says where it relied on secondary reporting. How we verify · Report an error