Component auditor services
Component auditing is the audit of one part of a group, a subsidiary, branch or division, so the parent can consolidate it. We work from either side, as the component auditor at your subsidiary or as the group auditor over your consolidated statements, and we plan against the consolidation date from the first call.
The role of a component auditor at your subsidiary
We audit your entity to the group auditor's plan and report to the group auditor, so the parent can consolidate your numbers on time:
Testing on the assigned balances.
Revenue, inventory, fixed assets or whichever balances the group auditor assigns to your entity.
Two-way communication.
We send findings, significant risks, related party matters and going concern indicators to the group auditor as we find them.
Review-ready documentation.
We prepare working papers and written communications in the group's format for the group auditor to review.
Group ethical requirements.
We confirm compliance with the ethical requirements that apply to the group audit, which can differ from the local ones.
Local framework differences.
We flag differences between the parent's framework and US GAAP before consolidation.
Why the component auditor is part of the engagement team
Under SAS 149 and under PCAOB standards, your component auditor is part of the group engagement team. The group auditor directs our work and takes responsibility for it in the group opinion. You get one audit plan, one materiality level and one timetable across the group.
- Under SAS 149, for periods ending on or after December 15, 2026, a component auditor is part of the engagement team. It can be a network firm, an unrelated firm or another office of the group auditor's firm.
- For fiscal years ending on or after December 15, 2024, the PCAOB reached the same answer. The lead auditor supervises an other auditor under AS 1201 as a member of the engagement team.
When the group auditor makes reference to another firm's audit instead, that firm is a referred-to auditor and is outside the team.
Two sides of a group audit we work on
As the component auditor
A parent's group auditor sends the scope, the component materiality and the deadline. We audit the entity in front of us against that plan and hand back findings, risks and documentation. We support US subsidiaries of foreign parents through our statutory audit service and work to the parent's reporting timetable.
As the group auditor
You consolidate more than one entity and need one opinion on the consolidated statements. We plan the group audit, decide where procedures are performed, involve auditors at the components we cannot cover centrally, and sign the report. Where a subsidiary already has its own auditor, we tell you early whether we can take responsibility for that work or refer to it instead, because we plan each route differently.
500+
completed audits
50
states served
AICPA
peer-reviewed firm
16+
years in audit
Firm figures as of September 2026, from the Dimov Audit homepage.
The component audit timetable
How component audit work is coordinated
Four stages, run to the parent's consolidation timetable.
The group auditor sends instructions
The parent's group auditor sends scope, component materiality and the reporting deadline
We plan against the consolidation date
We work back from the parent's timetable
Fieldwork at the component
Testing on the balances assigned to this entity
Reporting pack handed over
We send findings, risks and documentation to the group auditor
The group auditor keeps responsibility for the group opinion throughout.
Dimov Audit
Component auditor or referred-to auditor, which your group needs
The group auditor chooses between the two before fieldwork, and plans your timetable around the choice. With us as component auditor, the group auditor directs our work and takes responsibility for it in the group opinion. With us as referred-to auditor, we audit your subsidiary on its own and the group auditor refers to our report. Where your group auditor wants the second route, we confirm early that your report can be issued in time to be referenced. See the full comparison of the two roles.
Who appoints the component auditor
You can appoint us directly, or your group auditor can ask us to perform the group work at your subsidiary. Where a local auditor is already in place, the group auditor decides whether to take responsibility for that work or, where permitted, refer to it in the report. Your auditor applies the standard for the framework it reports under:
- AICPA GAAS:
- AU-C 600, and SAS 149 for periods ending on or after December 15, 2026.
- The ISAs:
- ISA 600 (Revised).
- PCAOB:
- AS 1201 when the lead auditor keeps responsibility, and AS 1206 when it divides it.
Where we are the local auditor, we confirm independence against the group's requirements before accepting the role.
What we need from you to meet the consolidation date
Send the group auditor's instructions on day one.
We plan the work from the scope, component materiality and deadline in them.
Name one contact at the subsidiary.
We route requests and answers through that person.
Flag framework differences early.
Tell us where the subsidiary reports under US GAAP and the parent under another framework, so we reconcile the two before consolidation.
Agree working paper access.
The group auditor reviews our work, so agree the format and the access route with both firms before fieldwork.
What affects the cost of a component audit
We price a component audit on five factors:
Balances assigned. We test each balance the group auditor assigns to the entity.
Reporting framework. If the parent reports under a framework other than US GAAP, we reconcile the differences before consolidation.
Condition of the records. If your ledger matches your bank statements, we start testing at once; if it does not, we scope the cleanup separately.
Documentation requirements. Some group auditors want working papers in their own format, and we build them to it.
Time before consolidation. If we receive the instructions late, we compress the fieldwork to meet the consolidation date.
A single US subsidiary with clean records and instructions in hand is at the light end. These are the factors, not a quote.
Send us the group structure
Start hereTell us which entity needs auditing, who the group auditor is, and what date the parent consolidates. If the group auditor has already sent instructions, send those as well and we will tell you whether the date is achievable. We will come back with scope, timeline and fee.
Contact
Connect with Dimov Audit
Our dedicated team is ready to assist you on your path to financial success.
24 Mercer St, 2nd Floor, Suite 214
New York, NY 10013
United States
Reviewed by George Dimov, CPA. Dimov Audit performs component audits and group audits for US subsidiaries and consolidated groups across all 50 states.