Financial Reporting Council Tightens Standards for Auditors Using External Experts

Key Takeaways

• External Expert Rules Revised: The FRC has revised ISA (UK) 620 and ISAE (UK) 3000, covering the use of external experts in audit and assurance engagements.
• International Alignment Maintained: The changes keep UK standards aligned with equivalent IAASB standards and interoperable with new ethical provisions in the IESBA Code.
• Evaluation Requirements Clarified: Practitioners must evaluate an external expert’s competence, capabilities and objectivity, with the revisions reinforcing expectations around evaluation and documentation.
• December 2026 Effective Date: The revised standards take effect for audits of financial statements for periods commencing, and assurance reports dated, on or after December 15, 2026.

Deep Dive

The Financial Reporting Council has revised two UK standards covering the use of external experts, tightening the rules around how auditors and assurance practitioners judge the people whose specialist work they rely on.

The revisions, published September 23, apply to ISA (UK) 620, Using the Work of an Auditor’s Expert, and ISAE (UK) 3000, Assurance Engagements Other Than Audits or Reviews of Historical Financial Information. They follow changes to the equivalent international standards issued by the International Auditing and Assurance Standards Board.

The point is alignment, but the substance sits in what happens when an engagement reaches the limits of the practitioner’s own expertise. An external expert may supply the specialist knowledge. Responsibility for deciding whether that work can be relied upon remains with the practitioner.

The revised standards align definitions and responsibilities for evaluating an external expert’s competence, capabilities and objectivity with the IAASB standards and new ethical provisions introduced by the International Ethics Standards Board for Accountants. The IESBA Code now contains explicit ethical requirements concerning the use of external experts in audit, assurance and non-assurance engagements.

The FRC has also made targeted changes to the requirements and application material in both UK standards. Those revisions clarify practitioners’ responsibilities when using an external expert and reinforce the need for robust evaluation and documentation.

There is little appetite at the FRC for creating a separate UK rulebook where one is not necessary. The regulator said it strongly supports maintaining alignment with standards issued by the IAASB unless an overriding public-interest reason justifies a UK-specific approach.

There is a practical calculation behind that position. Standards capable of being used across jurisdictions can reduce the cost to companies of meeting reporting and audit obligations while supporting consistency and quality in audit and assurance. Keeping the UK standards interoperable with the IESBA Code serves the same purpose: the auditing requirements and the ethical obligations governing the use of experts are meant to work together rather than pull practitioners in different directions.

For audit firms and assurance practitioners, the revisions sharpen a responsibility that cannot be handed over with the specialist assignment itself. Bringing in an expert does not settle whether that expert’s work is suitable for the engagement. The practitioner still has to evaluate the expert’s competence, capabilities and objectivity, and the revised standards reinforce the documentation expected around that judgment.

The timetable is now fixed. ISA (UK) 620 will apply to audits of financial statements for periods commencing on or after December 15, 2026. The revised assurance requirements will apply to assurance reports dated on or after December 15, 2026.

That leaves firms with the work of bringing their procedures into line with the revised standards before the effective date. The specialist judgment may belong to the expert. The responsibility for deciding whether it can be relied upon does not.

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