SA 620 - Using the Work of an Auditor
/ Auditing

SA 620 – Using the Work of an Auditor

This SA covers the auditor’s responsibilities when using expert work (person or organisation) for purposes other than accounting or auditing, which necessitates gathering sufficient and suitable audit evidence.

The responsibility of the auditor
The auditor bears sole responsibility for the audit opinion given in the audit report, which is unaffected by the use of an auditor’s expert’s work. Assume that the auditor, after reviewing the expert’s work, decides that it is sufficient for the auditor’s goals. The auditor may accept the expert’s findings and conclusions as appropriate audit evidence in that situation.

The goal of the auditor
The auditor’s goals are as follows:

  •  The auditor must decide whether or not to use the work of an auditor’s expert in the FS audit.
  • If an expert’s work is used, the auditor must decide if the work is adequate for the auditor’s purposes.

Audit procedures: nature, timing, and scope
The auditor must evaluate the following factors to determine the nature, timeliness, and extent (NTE) of audit procedures related with the expert’s work:

  • The subject’s nature as it relates to the expert’s work.
  • The importance of the auditor’s expert work to the audit • The risk of material misstatement (ROMM)
  • The auditor’s knowledge of and experience with the previous result of the auditor’s expert.
  • Is the expert subject to the auditor’s firm’s quality control rules and processes, as defined by SA 220?

Reference in the Auditor’s Report about Auditor’s Expert
Unless required by rules or legislation, an auditor’s report providing an unmodified opinion should not make reference to the auditor’s expert work. If such a reference is:

  • Required by law or regulation; or
  • Relevant to an understanding of a moderation to the auditor’s opinion, then it should be included.

Some other requirements related to auditor’s expert work

Particulars Details
Competence, capabilities, and objectivity For auditing reasons, auditors should assess the expert’s competence, objectivity, and capacities (COC). The objective examination of the auditor’s external expert includes questions about conflicts of interest and relationships that could jeopardise that expert’s objectivity.
Understanding of the field of expertise The auditor should gain a thorough grasp of the following:

  • The expert’s work’s nature, scope, and objectives.
  • Assess the suitability of expert labour for audit purposes.
Agreement with expert work The auditor should agree in writing the following:

  • The nature, scope, and objectives of the expert work should be agreed upon in writing by the auditor.
  • Roles and responsibilities that are mutually respectful
  • The auditor and expert’s nature, time, and communication (NTC)
  • The format of the expert report to be issued
  •  The expert must be aware of the need for secrecy.
Adequacy of auditor’s expert work The auditor should assess the sufficiency of the auditor’s expert work, taking into account:

  • The relevance and reasonableness of the auditor’s expert opinion or finding.
  • The audit evidence is consistent with other audit evidence.
  • Importance and adequacy of any important assumptions or methodologies employed
  • Source data accuracy, completeness, and significance (if any)
Insufficient expert work If the auditor believes that the expert’s work is not adequate, then:

  • Determine the nature and extent of additional work to be performed by the expert
  • Perform further audit procedures suitable to the situation