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ACCA Strategic Professional · Advanced Audit and Assurance (International) · Using the work of others

Delta & Co is planning to use a valuation specialist, Mara Chen, who is employed by Delta's own firm, to assess the fair value of unquoted equity investments held by a client. Which statement is correct under ISA 620?

The auditor remains solely responsible for the opinion, so an unmodified audit report should not refer to Mara's work. She is an auditor's expert, and her competence, capabilities and objectivity must still be evaluated even though she works for the same firm.

  1. AMara is a management's expert, because she is not part of the audit engagement team
  2. BThe auditor must evaluate Mara's competence, capabilities and objectivity, and the audit report should state that the expert is responsible for the valuation conclusion
  3. CThe auditor remains solely responsible for the audit opinion, so the report should not refer to Mara's work in an unmodified opinionCorrect
  4. DThe auditor may rely on Mara's work without any evaluation, because she is employed by the same firm

Explanation

Mara is an auditor's expert, an internal one, since she is in the audit firm and her work is used to obtain audit evidence. Under ISA 620 the auditor must evaluate her competence, capabilities and objectivity; being in the firm does not remove the need, although firm policies may help. The auditor has sole responsibility for the opinion, so an unmodified report must not refer to the expert.

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