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Chapter 113 4

Agreeing the work to be performed

The auditor should obtain an understanding of the field of expertise of the expert to
enable the external auditor to determine the scope and objectives of the work.

Before any work is performed by the expert the auditor should agree in an
engagement letter with the expert:

 The nature, scope and objectives of the expert’s work.

 The roles and responsibilities of the auditor and the expert.

 The nature, timing and extent of communication between the two parties.

 The need for the expert to observe confidentiality.

Once the work has been completed the auditor must then assess it to ensure it is
appropriate for the purposes of the audit. This involves consideration of:

 the consistency of the findings with other evidence

 the relevance and reasonableness of the assumptions and methods used by
the expert

 the relevance, completeness and accuracy of the source data used.

If the work is not deemed adequate, further work must be agreed with the expert.

Relying on the work of a management expert

ISA 500 Audit Evidence provides guidance on what the auditor should consider
before relying on the work of management's expert. This guidance is very similar to
that given in ISA 620.

The auditor must:

 Evaluate the competence, capabilities and objectivity of that expert.

 Obtain an understanding of the work of that expert.

 Evaluate the appropriateness of that expert’s work as audit evidence for the
relevant assertion

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