Choice "B" is correct. The independent auditor is solely responsible for reporting on the financial statements. Thus, while he or she may use the work of the entity's internal auditor (both work already performed and work performed as part of the audit), independent auditors may not share any responsibility involving judgments, including the assessment of inherent and control risk. This is true because the internal auditor, even if assessed to be both competent and objective, is not independent.
Choices "a", "d", and "c" are incorrect, based on the above explanation.
