If the auditor’s independence is compromised, there is a significant risk that the audit findings may be biased, incomplete, or not reported honestly. Such outcomes could undermine the credibility of the audit process and Bright-Farms’ governance framework, potentially exposing the company to risks in procurement integrity and operational control. The Board of Bright-Farms plays a critical role in ensuring that internal auditors remain independent of the functions they audit. By upholding the independence of the internal audit function, Bright-Farms can ensure objective, reliable assurance, thereby maintaining stakeholder trust in its governance, risk management, and control processes as the company continues to grow. REQUIRED 2.1 2.2 2.3 Define independence as it pertains to an internal audit function and explain the reporting relationship that should be in place to obtain organisational independence. List the two (2) most important elements of independence. Describe five (5) responsibilities of senior management regarding organisational independence. QUESTION 2 Marks (4) (6) 11 marks Bright-Farms Ltd, under the leadership of Chief Audit Executive Thato Mbeki, is focused on maintaining the highest standards in its vertical farming operations as it expands across South Africa. Recently, the internal audit function (IAF) was assigned to review the procurement process for key farming inputs, such as seeds and hydroponic nutrients, which are critical to product quality and operational efficiency. However, a concern has arisen: the internal auditor assigned to this review previously worked in the procurement department and retains close personal relationships with several current procurement staff. This situation raises serious concerns about the auditor’s independence, both in fact and in appearance. To safeguard the integrity of the internal audit, it is essential that Thato, as the Chief Audit Executive (CAE), reports to a level within BrightFarms' governance structure that supports and protects the audit function’s independence. If the auditor’s independence is compromised, there is a significant risk that the audit findings may be biased, incomplete, or not reported honestly. Such outcomes could undermine the credibility of the audit process and Bright-Farms’ governance framework, potentially exposing the company to risks in procurement integrity and operational control. The Board of Bright-Farms plays a critical role in ensuring that internal auditors remain independent of the functions they audit. By upholding the independence of the internal audit function, Bright-Farms can ensure objective, reliable assurance, thereby maintaining stakeholder trust in its governance, risk management, and control processes as the company continues to grow. REQUIRED 2.1 2.2 2.3 Define independence as it pertains to an internal audit function and explain the reporting relationship that should be in place to obtain organisational independence. List the two (2) most important elements of independence. Describe five (5) responsibilities of senior management regarding organisational independence.