Section Table of Amendments - ASQC 1 - Quality Control for Firms that Perform Audits and Reviews of Financial Reports and Other Financial Information, and Other Assurance Engagements - Table of Amendments | Zoe
ASQC 1 - Quality Control for Firms that Perform Audits and Reviews of Financial Reports and Other Financial Information, and Other Assurance Engagements
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Turn the raw legal text into a practical explanation grounded in ASQC 1 - Quality Control for Firms that Perform Audits and Reviews of Financial Reports and Other Financial Information, and Other Assurance Engagements.
Auditing Standard ASQC 1 Quality Control for Firms that Perform Audits and Reviews of Financial Reports and Other Financial Information, Other Assurance Engagements and Related Services Engagements (as amended to 30 June 2020) is set out in paragraphs Aus 0.1 to A75.
This Auditing Standard is to be read in conjunction with ASA 101 Preamble to Australian Auditing Standards, which sets out the intentions of the AUASB on how the Australian Auditing Standards, operative for financial reporting periods commencing on or after 1 January 2010, are to be understood, interpreted and applied.
Conformity with International Standards on Quality Control
This Auditing Standard conforms with International Standard on Quality Control ISQC 1 Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements issued by the International Auditing and Assurance Standards Board (IAASB), an independent standard‑setting board of the International Federation of Accountants (IFAC).
Paragraphs that have been added to this Auditing Standard (and do not appear in the text of the equivalent ISQC) are identified with the prefix “Aus”.
The following requirements are additional to ISQC 1:
At least annually, the firm shall obtain written confirmation of compliance with its policies and procedures on independence from all firm personnel required to be independent by relevant ethical requirements, and applicable legal and regulatory requirements. (Ref: Para. Aus 24.1)
The firm shall establish policies and procedures designed to provide it with reasonable assurance that:
Appropriate consultation takes place on difficult or contentious matters;
Sufficient resources are available to enable appropriate consultation to take place;
The nature and scope of, and conclusions resulting from, such consultations are documented and are agreed by both the individual seeking consultation and the individual consulted; and
Conclusions resulting from consultations are implemented; or
The reasons alternative courses of action from consultations were undertaken, are documented. (Ref: Para. Aus 34.1)
The following application and other explanatory material are additional to ISQC 1:
For audits or reviews of financial reports conducted under the Corporations Act 2001 (the Act), section 307B of that Act requires an auditor or member of an audit firm to retain all audit working papers prepared by or for, or considered or used by, the auditor in accordance with the requirements of the Australian Auditing Standards until:
(a) The end of seven years after the date of the audit report prepared in relation to the audit or review to which the audit working papers relate; or
(b) An earlier date determined by the Australian Securities and Investments Commission for the audit working papers. (Ref: Para. Aus A61.1)
Relevant law or regulation, other than the Corporations Act 2001, may require the retention of audit working papers for specified periods. (Ref: Para. Aus A61.2)
Unless otherwise specified by law or regulation, engagement documentation remains the property of the firm. The firm may, at its discretion, make portions of, or extracts from, engagement documentation available to clients, provided such disclosure does not undermine the validity of the work performed or the independence of the firm or its personnel. (Ref: Para. Aus A63.1)
In the public sector, an auditor appointed under statute (for example, an Auditor‑General) may delegate responsibility for an engagement. The monitoring process needs to include, on a cyclical basis, inspection of at least one completed engagement of each person with delegated responsibility for an engagement and its performance. This includes an external person engaged as the person responsible for an engagement. (Ref: Para. Aus A68.1)
This Auditing Standard incorporates terminology and definitions used in Australia.
The equivalent requirements and related application and other explanatory material included in ISQC 1 in respect of “relevant ethical requirements”, have been included in another Auditing Standard, ASA 102 Compliance with Ethical Requirements when Performing Audits, Reviews and Other Assurance Engagements. There is no international equivalent to ASA 102.
Compliance with this Auditing Standard enables compliance with ISQC 1.