The auditor should seek reasonable assurance that the expert’s work constitutes appropriate audit evidence in support of the financial statements. The auditor should consider;
- The skills and competence of the expert
- The auditor should consider the expert’s skills and competence in the particular profession. This is done by considering the expert’s professional qualifications, license or membership of an appropriate professional body. The experience and reputation in the field in which the auditor is seeking evidence.
- Objectivity and independence of the exper
- The auditor should consider whether the expert is independent from the client. The risk of independence being impaired increases where the expert is employed by the client; in such cases he owes his loyalty to the client, or where he is related financially with the client.
- The sources of data used by the expert in arriving at his opinion. If the source of the data can be regarded as reliable, then the auditor can reasonably use the work of the expert as audit evidence.
- The assumptions and methods used.
- The auditor should consider whether the methods used by the expert in arriving at his opinion are appropriate to the circumstances. He should also obtain an understanding of those assumptions and methods to determine that they are reasonable based on the auditor’s knowledge of the client’s business and the results of his other audit procedures.