IFAC’s Response to the IESBA’s Proposed Revisions to the Code Relating to Using the Work of an External Expert

IFAC welcomes the opportunity to provide input to the International Ethics Standards Board for Accountants' (IESBA) Exposure Draft (ED) for the proposed revisions to the IESBA Code relating to using the work of an external expert.  

IFAC appreciates the tremendous effort and significant resources the IESBA has devoted to this important project. Effective use of experts can help improve the quality of reporting and assurance, while the use of external experts is especially important for small- and medium-sized practices (SMPs) where there is often less in-house knowledge of specialist areas. It is critical to the public interest that standards in this area do not discourage the use of experts and that any requirements are clear and consistent with the reporting and assurance standard they will be used alongside.  

We raise several significant challenges with the proposals made in the ED. Some of the requirements outlined may create inappropriate barriers to the use of experts which could have a detrimental impact on quality in engagements. There are also challenges relating to the subjective evaluation of competence, capability, and objectivity, and the associated prohibition where even unrealistic challenges to objectivity could result in an inability to use the work of an expert. The information gathering needed in some areas is also excessive and practically challenging. In addition, there are some inconsistencies in approach and terminology compared to the International Auditing and Assurance Standards Board's (IAASB) proposed International Standard on Sustainability Assurance (ISSA) 5000 which should be navigated.