[section separator="true"]
[section-item 9]
[row]
[column 12]
[toc-this]
Definitions
An external expert is an individual or organisation possessing specialist skills, knowledge, or experience who enters into an agreement with the ECA to:
- assist us to obtain sufficient, appropriate audit evidence; or
- provide advice to confirm, challenge, or refine significant judgements made throughout the task.
Experts are used to make available the technical knowledge or skills required to achieve the objectives of a task, when such knowledge or skills are not available within the ECA, or to perform technical work, which they can perform more efficiently.
We engage and use the experts either individually or collectively in the form of focus groups. Non-remunerated interviews of specialists, or use of their independent work, are not considered as external expertise in this sense, but as oral or documentary [link title="evidence" link="%2Faware%2FGAP%2FPages%2FAudit-evidence.aspx" /]
provided by third parties. Neither does using external expertise cover the situation of using the [link title="work%20of%20other%20auditors" link="%2Faware%2FGAP%2FPages%2FSpecific%2FWork-of-other-auditors.aspx" /]
.
Principles
The decision regarding whether, and to what extent, to use external expertise should be justified and documented.
When entering into contracts with experts, procurement rules apply. The selection of experts, and the procedure for awarding them contracts are subject both to the usual rules governing the proper use and sound financial management of EU funds and to the availability of those funds.
Experts contracted by the ECA are bound by requirements of confidentiality.
As regards our auditees and reviewees, [link title="the%20no%20surprises%20approach" link="%2Faware%2FGAP%2FPages%2FCommunication-in-audit.aspx" /]
applies when it comes to the use of external expertise.
When using the work of experts as audit evidence, it should be sufficient, appropriate, and corroborated in the same way as other evidence.
When using the work of experts, the ECA remains fully responsible for the content of the reports and any audit opinion/conclusions/closing remarks.
The nature, timing and extent of procedures required when using experts depend on:
- the significance of the expert’s work in the context of the task;
- the nature and level of risk of the area under audit/review;
- previous experience of working with the expert and knowledge of his/her competence, capabilities and objectivity; and
- the nature of work the expert is asked to do and the level of subjectivity and complexity of judgments involved (including whether performing procedures that are integral to the task or providing advice on a specific matter);
Instructions
Determining the need for external expertise
In the task plan, explain and justify the planned use of experts and show the purpose and the expected results. Provide full details in Assyst.
For example, we may engage experts to:
- carry out in-depth analyses of specific areas, such as employee benefits, pensions and contributions to the sickness insurance scheme;
- provide technical expertise in areas such as construction of roads, financial instruments, greenhouse gas emissions;
- get an overview of good practice in an area; or
- advise on our audit approach, objectives, focus of the analysis, findings, conclusions and recommendations, or closing remarks for reviews.
When deciding whether to use external expertise, consider:
- the nature, significance, level of risk and complexity of the task/area under audit/review;
- the audit/review procedures foreseen;
- the knowledge and experience available within the ECA;
- any work already carried out for the auditee/reviewee by experts; and
- alternative sources of evidence.
Also, consider alternative arrangements such as focused training for an audit team member, who will then have the possibility to use the expertise acquired in other tasks.
[toggles]
[toggle title="Practical%20advice"]
- Consider whether it may be more cost-efficient and beneficial to develop in-house expertise by sending an ECA staff member on an appropriate training course.
- Consider avoiding risks associated with relying on an individual expert by organising a focus group with a mix of different experts.
- Plan to use the work of experts mainly to complement other audit evidence and avoid using the work of one expert as a main pillar of audit evidence.
- Use external experts or focus groups in the planning phase, for example to: obtain an understanding of the audit/review area; identify and assess risks; assess the feasibility of the approach; fine-tune audit questions and criteria; and design audit procedures.
- Involve external experts or focus groups in an early drawing conclusions procedure or to supplement the review process, for example to: clarify facts; confront ideas; formulate and/or validate findings, conclusions, and recommendations; ensure completeness; prioritise issues; obtain examples; and develop stronger arguments for the clearing/adversarial process.
- During the audit/review, bear in mind that if necessary, you can update the initial decision on whether and how to use external expertise.
[/toggle]
[/toggles]
Selection and contract
As soon as the need for engaging an expert and an estimate of the likely cost are established, contact the ECA procurement team to find out about practicalities related to contracting experts, request budget provision, and arrange the procurement procedure.
When engaging experts:
[toggles]
[toggle title="Practical%20advice"]
- Read up on the applicable procedures, available on the legal service procurement site, and contact the procurement team early in the process for additional support and advice, including the availability of funds and the list of contracted experts.
- Build in additional time and resources to organise, manage, and evaluate the work of experts and to reflect on and transform the deliverables into audit findings. Identify an assistant for organisational work.
- Establish clear selection and evaluation procedures/criteria.
- For focus groups, consider the total number of participants needed in relation to time available and the number of topics. Five or six is usually enough to have a good variety - with more there is a risk of not getting everyone’s views. Seek to include participants with different views, backgrounds, gender, and coming from different interests groups. Consider appointing a moderator for the discussion.
- Evaluate the competence, reputation and objectivity of experts by assessing previous experience from working with these experts; discussions with the experts or others familiar with their work; their educational and professional qualifications and their published works, as well as whether it is subject to professional standards or requirements.
- Objectivity may be of less importance for individual focus group participants as long as we are aware of any interests and relationships with the auditee/reviewee. Seek to corroborate information or views gathered.
- In tender specifications (or equivalent), set out clearly expectations, including qualitative aspects, of the expert’s contribution (performance standards, professional requirements etc.) so that it can be used later to evaluate their work.
- When contracting an expert to produce a report, include in the tender specifications (or equivalent) the possibility to ask follow-up questions.
- When agreeing on the respective roles and responsibilities of the audit team and the experts, consider for example who tests the source data, any access to and retention of working papers, and if the experts will participate in clearing of the findings.
[/toggle]
[/toggles]
Confidentiality
Confidentiality requirements are laid down in the [link new-window title="Treaties" link="https%3A%2F%2Feur-lex.europa.eu%2Flegal-content%2FEN%2FTXT%2FPDF%2F%3Furi%3DCELEX%3A12012E%2FTXT%26from%3DEN%23page%3D123" icon="external-link" /]
, Staff Regulations and in ECA decisions (professional secrecy). All experts having access to audit information are required to sign a confidentiality agreement (consult legal service for the templates and guidance), and, where applicable, declare any potential conflict of interest.
Take into account the rules on confidentiality and the Information classification policy when planning the experts’ access to records of the auditee/reviewee and to personnel. The Information Security Officer is available to provide advice on making available to the experts documents containing non-public information.
No surprises approach
Inform the auditee/reviewee in advance of the plan to use external expertise. Discuss the criteria to be followed, how findings based on the work of the expert will be cleared, and clarify any issues regarding confidentiality.
Evaluation
Evaluate:
- the relevance and reasonableness of the expert's findings and/or advice, and the consistency with other work; and
- if significant to the use of the expert's work, the relevance and reasonableness of assumptions and methods used by the expert, and the completeness, relevance and accuracy of source data.
Where you consider the expert's contribution to be insufficient or inadequate for the purposes of the audit/review, decide on further work to be performed, or consider alternative audit/review procedures as appropriate.
Evaluate separately the completion of the contract in order to release the payment following the procurement rules.
[toggles]
[toggle title="Practical%20advice"]
- Keep up to date with any issues arising by having an ongoing dialogue with experts during the course of their work.
- Evaluation procedures may include:
• questioning the expert;
• observing the work of the expert;
• reviewing the work of the expert;
• verifying published data;
• performing analytical procedures;
• re-performing calculations; and
• discussing with other experts, third parties and/or the auditee/reviewee.
- Where relevant, check:
• references and clarity of the presentation;
• the nature and sources of data and information used by the expert;
• whether the expert followed relevant technical performance standards or other professional requirements;
• whether the expert used generally accepted and appropriate assumptions and methods and whether these were consistent with those used by the auditee/reviewee – if not, check the reason for and effects of the differences; and
• whether the expert’s findings/views were subject to any reservations, limitations, or restrictions on use.
- Ask participants of focus groups to agree on the minutes of meetings and to provide additional information where needed. Assess their input in relation to other audit findings and with consideration to their respective backgrounds and any known bias. If relevant, obtain additional evidence in response to comments made by the focus group.
[/toggle]
[/toggles]
Referring to experts in reports
In [a-glossary term="Statement%20of%20Assurance"]Statement of Assurance[/a-glossary]
audits, when issuing an [link title="unmodified" link="%2Faware%2FGAP%2FPages%2FCA-FA%2FReporting%2FUnmodified-opinion.aspx" /]
("clean") audit opinion, do not refer to the expert's work. However, if reference to the work of an expert is relevant to understanding a [link title="modification" link="%2Faware%2FGAP%2FPages%2FCA-FA%2FReporting%2FModified-opinion.aspx" /]
to the opinion, indicate that the reference does not diminish the ECA’s responsibility for that opinion.
If reference is made to the use of external experts in performance audit or review reports, this should be in the [link title="scope%20and%20approach" link="%2Faware%2FPA%2FPages%2FReporting%2FScope-and-approach.aspx" /]
section. The details of the work performed should not be disclosed and we should not name the experts.
Documentation
[link title="Document" link="%2Faware%2FGAP%2FPages%2FDocumenting-an-audit.aspx" /]
in Assyst the main processes, decisions, and conclusions with regard to the use of external expertise, notably:
- how the need for using external expertise was established and justified;
- the selection and contracting procedures; and
- evaluation of the adequacy of the experts’ work (including how, criteria used, by whom, and conclusions).
[toggles]
[toggle title="Examples%20of%20what%20to%20document%20in%20Assyst"]
- Justification of the need for using external expertise, including the expected result(s).
- Selection criteria and procedures.
- Assessment of the expert’s competence, reputation, independence and objectivity, including any potential conflict of interest.
- Contract/agreement (including nature, scope and objective of the expert’s work), confidentiality agreement, declaration of any potential conflict of interest.
- Respective roles and responsibilities of the audit team and the expert.
- Any agreements with the auditee/reviewee relating to the use of external expertise.
- Minutes of meetings and ongoing dialogue, including any modifications of objectives.
- Where relevant, supervision and review (how, when, by whom, conclusion).
- Evaluation of the adequacy of the expert’s work and/or of his/her advice, including corroboration and check of consistency with other findings (how, when, by whom, conclusions and any decision to perform additional procedures).
[/toggle]
[/toggles]
[icons-list icon-size="2" separator="line" icon-vertical-alignment="middle" vertical-alignment="middle"]
[/icons-list]
[/toc-this]
[/column]
[/row]
[/section-item]
[section-item 3]
[row]
[column 12]
[panel panel-style="boxed" title="Related%20documents" icon="book" class="ref-panel"]
[standards]
[link new-window title="ISA%20620" link="https%3a%2f%2fwww.ifac.org%2fsystem%2ffiles%2fpublications%2ffiles%2fIAASB-2020-Handbook-Volume-1.pdf%23INTERNATIONAL%2520STANDARD%2520ON%2520AUDITING%2520620" /]
[link new-window title="ISSAI%20400%2F45" link="https%3a%2f%2fwww.issai.org%2fwp-content%2fuploads%2f2019%2f08%2fISSAI-400-Compliance-Audit-Principles-1.pdf%23page%3D19" /]
[link new-window title="ISSAI%204000%2F75%2C" link="https%3a%2f%2fwww.issai.org%2fwp-content%2fuploads%2f2019%2f08%2fISSAI-4000-Compliance-Audit-Standard.pdf%23page%3D22" /]
[link new-window title="%2088" link="https%3a%2f%2fwww.issai.org%2fwp-content%2fuploads%2f2019%2f08%2fISSAI-4000-Compliance-Audit-Standard.pdf%23page%3D24" /]
[link new-window title="ISSAI%20300%2F30" link="https%3a%2f%2fwww.issai.org%2fwp-content%2fuploads%2f2019%2f08%2fISSAI-300.pdf%23page%3D19" /]
[link new-window title="ISSAI%203000%2F65" link="https%3a%2f%2fwww.issai.org%2fwp-content%2fuploads%2f2019%2f08%2fISSAI-3000-Performance-Audit-Standard.pdf%23page%3D18" /]
[link new-window title="GUID%203910%2F81" link="https%3a%2f%2fwww.issai.org%2fwp-content%2fuploads%2f2019%2f08%2fGUID-3910-Central-Concepts-for-Performance-Auditing.pdf%23page%3D33" /]
[/standards]
[/panel]
[/column]
[/row]
[row]
[column 12][/column]
[/row]
[row]
[column 12]
[toc fixed="true" selectors="h2%2Ch3" class="basic-toc" /]
[/column]
[/row]
[/section-item]
[/section]
