ISA 620 (Revised) DEALS with the auditor’s responsibilities RELATING to the work of an individual or organization in a field of expertise OTHER than accounting or auditing, when that work is used to assist the ‘Auditor’ in obtaining sufficient appropriate audit evidence.
Table of Contents
- ISA 620 (Revised) – Introduction
- ISA 620 – Objectives
- ISA 620 – Definitions
- ISA 620 – Requirements
- 1. Determining the Need for an Auditor’s Expert
- 2. Nature, Timing and Extent of Audit Procedures
- 3. The Competence, Capabilities and Objectivity of the Auditor’s Expert
- 4. Obtaining an Understanding of the Field of Expertise of the Auditor’s Expert
- 5. Agreement with the Auditor’s Expert
- 6. Evaluating the Adequacy of the Auditor’s Expert Work
- 7. Reference to the Auditor’s Expert in the Auditor’s Report
- Synopsis
ISA 620 (Revised) – Introduction
1. Scope of this ISA
It deals with the auditor’s responsibilities relating to the work of an individual or organization in a field of expertise other than accounting or auditing, when that work is used to assist the Auditor in obtaining sufficient appropriate audit evidence.
2. Effective Date
This ISA is EFFECTIVE for audits of financial statements for periods beginning on or after December 15, 2009.
ISA 620 – Objectives
The Objectives of the ‘Auditor’ are:
- To DETERMINE whether to use the work of an auditor’s expert; AND
- If using the work of an auditor’s expert, to determine whether that work is ADEQUATE for the auditor’s purposes.
ISA 620 – Definitions
1. Auditor’s Expert
An Individual or Organization possessing expertise in a field OTHER than ‘Accounting’ or ‘Auditing’, whose work in that field is used by the auditor to assist the auditor in obtaining sufficient appropriate audit evidence.
2. Management’s Expert
An Individual or Organization possessing expertise in a field OTHER than ‘Accounting’ or ‘Auditing’, whose work in that field is used by the entity in preparing the Financial Statements.
ISA 620 – Requirements
1. Determining the Need for an Auditor’s Expert
If expertise in a field OTHER than accounting or auditing is necessary to obtain sufficient appropriate audit evidence, the auditor shall DETERMINE whether to use the work of an auditor’s expert.
2. Nature, Timing and Extent of Audit Procedures
The Nature, Timing and Extent of the auditor’s procedures with respect to the Requirements of this ISA will VARY depending on the circumstances.
| The Auditor Shall CONSIDER Matters Including: |
|---|
| (a) The nature of the matter to which that expert’s work relates; |
| (b) The risks of Material Misstatement in the matter to which that expert’s work relates; |
| (c) The significance of that expert’s work in the context of the audit; |
| (d) The auditor’s knowledge of and experience with previous work performed by that expert; AND |
| (f) Whether that expert is subject to the auditor’s firm quality control policies and procedures. |
3. The Competence, Capabilities and Objectivity of the Auditor’s Expert
The ‘Auditor’ shall EVALUATE whether the auditor’s expert has the necessary Competence, Capabilities and Objectivity for the auditor’s purposes.
4. Obtaining an Understanding of the Field of Expertise of the Auditor’s Expert
The ‘Auditor’ shall OBTAIN a sufficient understanding of the field of expertise of the auditor’s expert to enable the auditor to:
- DETERMINE the nature, scope and objectives of that expert’s work for the auditor’s purposes; AND
- EVALUATE the adequacy of that work for the auditor’s purposes.
5. Agreement with the Auditor’s Expert
| The Auditor Shall AGREE in Writing When Appropriate on the Following Matters with the Auditor’s Expert: |
|---|
| (a) The nature, scope and objectives of that expert’s work; |
| (b) The respective roles and responsibilities of the auditor and that expert; |
| (c) The nature, timing and extent of communication between the auditor and that expert, INCLUDING the form of any report to be provided by that expert; AND |
| (d) The need for the auditor’s expert to observe confidentiality Requirements. |
6. Evaluating the Adequacy of the Auditor’s Expert Work
The ‘Auditor’ shall EVALUATE the adequacy of the auditor’s expert work for the auditor’s purposes.
7. Reference to the Auditor’s Expert in the Auditor’s Report
The ‘Auditor’ shall NOT REFER to the work of an auditor’s expert in an auditor’s report containing an UNMODIFIED opinion.
If the ‘Auditor’ makes reference to the work of an auditor’s expert in the auditor’s report because such reference is relevant to an understanding of a MODIFICATION, the auditor shall INDICATE in the auditor’s report that such reference does not reduce the auditor’s responsibility for that opinion.
Synopsis
ISA 620 ‘Using the Work of an Auditor’s Expert‘ DEALS with the auditor’s responsibilities relating to the work of an individual or organization in a field of expertise other than accounting or auditing, when that work is used to assist the auditor in obtaining sufficient appropriate audit evidence.
[600-699] Using the Work of Others
Chartered Accountant – ICAP
Bachelor of Accounting (Honours) – AeU, Malaysia