When planning to use the work of an expert, the auditor should assess the professional competence of the expert.The auditor should satisfy himself as to the expert's skills, experience and competence by considering the professional qualifications, the licence or membership of an appropriate professional body, experience and reputation in the field in which the auditor is seeking evidence.
Objectivity of the expert
The auditor should assess the objectivity of the expert. Just like in his own case, whereby his objectivity has to be jealously guarded the auditor must consider the objectivity of the expert. The expert's objectivity can be impaired where the expert is employed by the client or is related in some other manner to the client for example being financially dependent upon or having an investment in the client. The auditor may have to perform more extensive procedures than would otherwise have been planned, or he should consider engaging another expert.
Communication with the expert
If the auditor intends to use the work of an expert then he must communicate with the expert well in advance to confirm the terms of engagement and also to cover other matters such as:
a) The objectives and scope of work;
b) An outline of the specific items the auditor expects to be covered in the report;
c) The intended use by the auditor of the expert's work including possible communication with third parties as to the expert's identity and extent of involvement.
d) Extent of access to appropriate records and files by the expert.
e) Clarification of the experts relationship with the client;
f) Confidentiality of the client's information;
g) The assumptions and methods intended to be used by the expert and how consistent they are with those used in the past;
h) The recording of any further information required as audit evidence.