CAS 402: Audit Considerations Relating to an Entity Using a Service Organization
Addresses the auditor's responsibilities when the entity uses a service organization (e.g., payroll provider, hosted ERP, transfer agent) for services that are part of the entity's financial reporting.
Why CAS 402 matters
Issuers running on hosted ERP, outsourced payroll, or third-party transfer agents need SOC 1 (Type 2) reports covering the audit period. Missing or mis-aligned SOC reports stall fieldwork.
Framework: Canadian Auditing Standards (CAS)
CAS are the auditing standards adopted by the Auditing and Assurance Standards Board (AASB) of CPA Canada. They are Canadian adoptions of the IAASB's International Standards on Auditing (ISAs) and govern every audit of financial statements performed in Canada.
Primary source: FRAS Canada
Frequently asked
What is CAS 402?
Addresses the auditor's responsibilities when the entity uses a service organization (e.g., payroll provider, hosted ERP, transfer agent) for services that are part of the entity's financial reporting.
Why does CAS 402 matter for an audit?
Issuers running on hosted ERP, outsourced payroll, or third-party transfer agents need SOC 1 (Type 2) reports covering the audit period. Missing or mis-aligned SOC reports stall fieldwork.
Which framework does CAS 402 belong to?
CAS 402 falls under Canadian Auditing Standards (CAS). CAS are the auditing standards adopted by the Auditing and Assurance Standards Board (AASB) of CPA Canada. They are Canadian adoptions of the IAASB's International Standards on Auditing (ISAs) and govern every audit of financial statements performed in Canada.
Related standards — Canadian Auditing Standards (CAS)
- CAS 200 — Overall Objectives of the Independent Auditor
- CAS 210 — Agreeing the Terms of Audit Engagements
- CAS 220 — Quality Management for an Audit of Financial Statements
- CAS 230 — Audit Documentation
- CAS 240 — The Auditor's Responsibilities Relating to Fraud
- CAS 250 — Consideration of Laws and Regulations
See how Auditus checks CAS 402
Auditus.ai runs PCAOB, ISA, and CAS engagements end-to-end and cites the exact standard behind every finding — including CAS 402.