Page 202 - Internal Auditing Standards

Guide to Using International Standards on Auditing in the Audits of Small- and Medium-Sized Entities Volume 1—Core Concepts

The exhibit below summarizes the considerations relating to engaging an auditor’s expert.

Exhibit 15.8-3

Consider need in relation to:
Is an auditor’s - Obtaining an understanding of the entity, including internal control
expert needed yes - Identifying/assessing the risks of material misstatement
to obtain - Determining/implementing overall responses to assessed risks at financial statement level
audit evidence? - Designing/performing further audit procedures to respond to assessed risks at assertion level
- Evaluating sufficiency/appropriateness of audit evidence obtained to form an opinion.
no Consider:
What procedures
- Nature of matter and risks of material misstatement
are required? - Significance of expert's work
(Nature/timing/extent) - Previous work performed by that expert
- If expert is subject to firm's quality control policies.

Is chosen expert yes
competent, capable,
and objective?

no
Do we (auditor) yes Is understanding sufficient to:
understand expert’s - Plan the audit?
- Review the results of work performed?
field of expertise?

no Agree upon:
Agree on terms - Nature, scope, and objectives of expert’s work
- Respective roles and responsibilities
of engagement.
- Nature, timing, and extent of communication,
including report format
- Need for confidentiality.
no

Plan alternative audit procedures appropriate to the circumstances.

Exhibit 15.8-4

Consider Discussion
Is an Auditor’s Consider need in relation to:
Expert Needed • Obtaining an understanding of the entity, including internal control;
to Obtain Audit
Evidence? • Identifying/assessing the risks of material misstatement;
• Determining/implementing overall responses to assessed risks at the fi nancial
statement level;
• Designing/performing further audit procedures to respond to assessed risks at
the assertion level; and

• Evaluating the sufficiency/appropriateness of audit evidence obtained to form
an opinion.

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