Microsoft Word Audit Quality-Framework Final vs 20140214
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| Appendix 2 57 101. Some modern methodologies provide the opportunity for electronic, off-site review of working papers, which can enable audit issues to be shared and considered efficiently, especially when dealing with different countries and across different time zones. However, off-site review may not always be an effective means: of assessing whether staff have undertaken the audit thoroughly and demonstrated an appropriate degree of professional skepticism; and for developing the skills and competences of less experienced staff. 1.8.4 The Methodology Requires Appropriate Audit Documentation 102. Audit documentation performs a number of roles, including: Assisting the engagement team to plan and perform the audit. Assisting members of the engagement team responsible for supervision to direct and supervise the audit work. Enabling the engagement team to be accountable for its work. Retaining a record of matters of continuing significance to future audits. Enabling the conduct of intra-firm quality control reviews and inspections, and external inspections in accordance with applicable legal, regulatory or other requirements. 103. Documentation of the rationale for significant audit judgments is likely to increase the rigor, and therefore the quality, of that judgment. The process of documenting the issues and how they have been resolved is likely to improve the rigor of the auditor’s thought process and the validity of the conclusions reached. 1.8.5 Rigorous Quality Control Procedures Are Established and Audit Quality Is Monitored and Appropriate Consequential Action Is Taken 104. Quality control procedures need to be established to provide the audit firm with assurance that: The firm complies with professional standards and applicable legal and regulatory requirements, and Reports issued by the firm or engagement partners are appropriate in the circumstances 10 105. Quality control procedures will include monitoring and taking remedial action when needed. Auditing involves compliance with standards and internal firm policies and procedures. It also involves difficult decisions and judgments made by staff at different levels of experience and sometimes under time pressure. 106. Monitoring audit quality within an audit firm is an important aspect of identifying emerging risks and opportunities, and ensuring that standards are being adhered to and that the partners and staff are performing appropriately. 107. Some audit firms operate internationally through a network of firms. Network firms often share common methodologies and quality control and monitoring policies and procedures. Some networks also share guidance in relation to values, ethics, and attitudes, and have programs to enhance the knowledge and experience of partners and staff. 10 The IAASB has issued ISQC 1, which sets out those activities in which firms are required to develop policies and procedures and thereby meet this objective. |