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ISQM

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8 views

ISQM

Uploaded by

sajinmathew37
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Quality Management

• Proactive attitude
• Not a compliance or tick box approach
• tailored to the firm and its client base enabling firms to design a system which addresses
their specific circumstances and risks.
• it is key to every audit and every stage of the audit process

Quality control procedures-HEALME RI


• Human resources
• Ethical requirements
• Acceptance & continuance responsibilities
• Leadership
• Monitoring
• Engagement performance
• Risk assessment process
• Information & communication

1. Risk assessment process


An ongoing monitoring process rather than a one-off event
Tailored according to the size of the firm and client portfolio
Based on
o Objectives
o Specific situation & environment
▪ Technologies employed by firm
▪ Networks
▪ External service providers

2. Governance & leadership


• Commitment to quality culture and public interest across the firm
• Tone at the top
• Responsibility of CEO or managing partner
• Quality over business-challenge client judgements without fear of the negative
consequences of losing the revenue arising from the loss of the client

3. Relevant ethical requirements


• Set objectives & policies to ensure fulfillment of ethical requirements depending on the size
& client portfolio
• Applicable to both group auditor & component auditor
• Ethical requirements might vary according to the jurisdictions
4. Acceptance and continuance of client relationships
procedures addressing client acceptance and continuance of existing business relationships

• Integrity of management
• Ethical values of management
• Compliance with Legal & professional requirements
• Competence
• Availability of resources
• Independence of the auditor

5. Engagement performance
audit engagement partner to be sufficiently and appropriately involved throughout the
engagement.

• Supervision
• Review
• ensure professional scepticism and judgement are exercised by engagement teams.
• insufficient time
• not experienced
• consultation-difference in opinions resolved

6. Resources
• employees with the required competence, training, and capabilities to perform the
engagements to which they are assigned.
• more experienced individuals to work on areas of a complex nature requiring additional
judgement
• ensuring sufficient review by senior team members
• allowing adequate time to do sufficient testing and analysis of the issues.
• use independent experts where the firm does not have appropriate personnel
• additional specialist technological resources.

7. Information and communication


Communications should be made in a timely manner supporting the firm’s culture to
exchange information where appropriate
• obtaining, generating and using information and
• communicating the information within the firm,
o communicating policies to personnel,
o communication of information obtained during an audit with an engagement
quality reviewer, or
o communication between group and component auditors.
• external communications
o communication within the firm’s network and with service providers,
o communications required by law or professional standards, such as when there
is a specific requirement to report a client’s non-compliance with certain laws and
regulations to TCWG.
Ethical & professional Client acceptance & Engagement performance
requirements continuation
• The firm’s policies on • Risk assessments • Audit programmes
ethics documented devised/produced
• Training material • Client identity • Role assignments
documents obtained delegated and
• Registers of training and stored recorded
undertaken
• Engagement letters • Client information
• Completed issued obtained and input
independence into automated audit
declarations tools
• Conclusions
documented in audit
file
• Reports to
management and
TCWG

8. Monitoring and remediation process


This process is a continuous cycle which firms are specifically required to undertake.

• Firms must put in place a process for monitoring the SoQM’s effectiveness and
• ensure deficiencies are identified in a timely manner,
• allowing corrective actions to be implemented.

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