SA 620 applies when the auditor uses the work of an expert in a field other than accounting and auditing — a property valuer, an actuary, a geologist — as audit evidence. The standard requires the auditor to evaluate the expert's competence, capabilities and objectivity; obtain an understanding of the expert's field sufficient to evaluate the adequacy of their work for the audit's purposes; and evaluate the appropriateness of the expert's work, including the relevance and reasonableness of the findings and the data and assumptions used. A signed, qualified-looking report does not, on its own, satisfy any of these three requirements.
Three things SA 620 requires, specifically
- 01Evaluate competence, capabilities and objectivityQualifications and experience relevant to this specific valuation, not expertise in general — and whether any relationship between the expert and the client creates a threat to objectivity, such as the expert being paid contingent on the valuation outcome.
- 02Obtain enough understanding of the expert's field to evaluate their workNot becoming an expert yourself — enough to ask informed questions about the method chosen and recognise when an assumption looks unreasonable.
- 03Evaluate the appropriateness of the expert's work for the audit's purposesThis is where the data and assumptions underlying the expert's conclusion get checked against what the audit team independently knows about the entity — the expert's maths can be entirely correct and still rest on an input the audit team knows to be wrong.
The most common SA 620 failure is checking that an expert is appropriately qualified and stopping there — without separately verifying that the data fed to the expert (a salary base, a property's physical condition, a set of actuarial assumptions) was itself complete and accurate. The expert's calculation is only as reliable as what they were given to work with.
Management's own expert vs. the auditor's own expert
| Management's expert | The auditor's own expert | |
|---|---|---|
| Who engages them | The client | The audit firm |
| What SA 620 requires | Evaluating their work as audit evidence, per the three steps above | The same evaluation, plus an agreement on scope and the terms of the engagement between the audit firm and its own expert |
| Typical use | An actuarial valuation of gratuity, a property valuation for impairment testing | A forensic specialist engaged by the audit firm to investigate a specific suspected irregularity |
Common practice, not a requirement
Where the client's own expert's work is being relied on, the evaluation and the evidence supporting it belong in the audit file just as any other evidence would — a reference to "the actuary's report" without the underlying evaluation of competence, data and assumptions does not satisfy SA 620 on review.
This is practical guidance written for audit teams, not an authoritative statement of any standard or statute. Standards, forms and timelines change. Check the current text issued by the ICAI and the relevant authority before relying on anything here in an audit file.
Related resources
- Audit workflow & automationSA 540: auditing accounting estimates, where judgment replaces a verifiable numberAn estimate can't be vouched to a source document the way an invoice can. SA 540 is about what replaces vouching when there's no single right answer to check against.
- Payroll & employee costThe gratuity provision that was computed on the wrong salary baseThe actuary had valued the obligation correctly. The data file feeding the actuary had the wrong number in it for every employee.
- Fixed assets & capexImpairment testing for fixed assets: a practical approachThe impairment indicators that actually matter for a mid-market client, when a formal test is genuinely warranted, and how to test management's recoverable amount workings.
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