Auditing and Assurance Standards and Guidance

Auditing Standards (Ireland)

FRC ISAs (UK and Ireland) applicable for periods beginning on or after 15 December 2010 but before 17 June 2016

ISA (UK and Ireland) 540 Auditing, accounting estimates, including fair value accounting estimates, and related disclosures

Application and Other Explanatory Material

Risk Assessment Procedures and Related Activities (Ref: Para. 8 )

Obtaining an Understanding of How Management Makes the Accounting Estimates (Ref: Para. 8(c) )

Management's Use of Experts (Ref: Para. 8(c)(iii) )

A29.	Management may have, or the entity may employ individuals with, the experience and competence necessary to make the required point estimates. In some cases, however, management may need to engage an expert to make, or assist in making, them. This need may arise because of, for example:

The specialized nature of the matter requiring estimation, for example, the measurement of mineral or hydrocarbon reserves in extractive industries.

The technical nature of the models required to meet the relevant requirements of the applicable financial reporting framework, as may be the case in certain measurements at fair value.

The unusual or infrequent nature of the condition, transaction or event requiring an accounting estimate.