PCAOB on Engagement Quality Review

Question 1

What’s the Applicability of Standard for the Engagement Quality Review?

Answer 1

Requires an engagement quality review (and concurring approval of issuance) for engagements conducted under PCAOB standards such as for an audit; for a review of interim financial information; and for an attestation engagement regarding compliance reports of brokers and dealers

Question 2

What’s the Objective of the Engagement Quality Reviewer?

Answer 2

To perform an evaluation of the significant judgments made by the engagement team and the related conclusions reached and in preparing any engagement report

Question 3

When does an outside reviewer become associated with the firm issuing the report?

Answer 3

When she receives compensation from the firm issuing the report for performing the review or performs the review as agent for the firm issuing the report

Question 4

What are the Qualifications of an Engagement Quality Reviewer?

Answer 4

1 Must be an associated person of a registered public accounting firm
2 Must have competence, independence, integrity, and objectivity

Question 5

What’s the Engagement Quality Review Process?

Answer 5

To evaluate the significant judgments and conclusions of the engagement team, the engagement quality reviewer should (1) hold discussions with the engagement partner and other members of the engagement team; and (2) review documentation

Question 6

What’s the Evaluation of Engagement Documentation?

Answer 6

the reviewer should evaluate whether the documentation that was reviewed (1) indicates that the engagement team responded appropriately to significant risks; and (2) supports the conclusions reached by the engagement team

Question 7

What is Concurring Approval of Issuance for a Reviewer?

Answer 7

In an audit, the engagement quality reviewer may provide concurring approval of issuance only if, after performing with due professional care the review required by this standard, he or she is not aware of a significant engagement deficiency

Question 8

Who requires an Engagement Quality Review, SQSC or PCAOB or both?

Answer 8

PCAOB

Question 9

What is SQSC’s view on Cooling-off Restriction and requirements to be a reviewer?

Answer 9

SQCS do not impose a “cooling-off” restriction or a requirement that the reviewer must be an associated person of a registered public accounting firm

Question 10

What is SQSCs stand point on Concurring Approval of Issuance?

Answer 10

SQCS requires any engagement quality review performed be completed before the engagement report is released without requiring a concurring approval of issuance