Management asked the internal audit activity to evaluate the appropriateness of self- insuring against casualty losses and health care for the organization's employees. Should the chief audit executive engage an actuarial consultant to assist in the audit engagement if these skills do not exist on staff?
- No, because the internal audit activity is skilled in assessing controls and the insurance control concepts are not distinctly different from other control concepts.
- No, because it is a normal audit function to assess risk; this audit engagement is therefore not unique.
- Yes, because an actuarial consultant is essential to determine whether the health-care costs are reasonable.
- Yes, because an actuarial consultant has skills, not usually found in the internal audit activity, to identify and quantify self-insurance risks.