ACCA Advanced Audit and Assurance (AAA) Practice Exam

ISA 620's focus on the auditor's expert primarily deals with which competency?

1. Communication skills of the expert

2. Objectivity and capability of the expert

3. The expert's knowledge of auditing standards

4. The expert's ability to evaluate audit evidence

The correct answer is: Objectivity and capability of the expert

The correct answer centers on the objectivity and capability of the expert, which is a fundamental aspect of ISA 620. When engaging an expert, it is crucial for auditors to ensure that the expert possesses not only the relevant knowledge and skills required for the specific area of expertise but also maintains an impartial stance. This is critical because any bias in the expert’s findings can undermine the reliability of the audit evidence that the auditor plans to use. ISA 620 acknowledges that the extent of the auditor's reliance on the work of an expert will depend significantly on the expert's ability to perform competently and independently. By evaluating both objectivity—ensuring there are no conflicts of interest or biases—and capability—confirming that they are sufficiently qualified—the auditor can make informed judgments about the credibility of the expert's contributions to the audit. While communication skills, knowledge of auditing standards, and the ability to evaluate audit evidence are also important in the overall audit process, they do not capture the essence of the core competency that ISA 620 emphasizes regarding the role of the auditor's expert. Thus, a solid focus on objectivity and capability provides a framework to evaluate external resources appropriately in the context of the audit, enhancing the audit's reliability and effectiveness.