Quality Control Standards (SQCS)

Question 1

List the services for which a CPA firm is required to have a system of quality control.

Answer 1

Audits, attestation, compilation and review services. (Not applicable to tax or consulting services.)

Question 2

What is meant by the term “engagement quality control review”?

Answer 2

A process designed to provide an objective evaluation, before the report is released, of the significant judgments the engagement team made and the conclusions it reached. (Such a process is only for those audit engagements for which the firm has determined that an engagement quality control review is required; it is not applicable to all audits.)

Question 3

List the six elements of a quality control system.

Answer 3

1. )Leadership responsibilities for quality within the firm
2. )Relevant ethical requirements (especially independence)
3. )Acceptance and continuance of client relationships
4. )Human resources
5. )Engagement performance
6. )Monitoring.

Question 4

Who is responsible for the administration of a quality control system?

Answer 4

Authority may be vested in one person but everyone shares responsibility.