Quality Control - The Audit Process

Question 1

Elements of Quality Control

Answer 1

HELP ME

H - Human Resources
E - Engagement/client acceptance and continuance
L - Leadership Responsibilities
P - Performance of the Engagement
M - Monitoring
E - Ethical Requirements

Question 2

Human Resources

Answer 2

Encompasses criteria for recruitment and hiring, determining capabilities and competencies, assigning performance evaluation, compensation and advancement

Question 3

Engagement/Client Acceptance and Continuance

Answer 3

Policies and procedures should be established for deciding whether to accept or continue a client relations and whether to perform a specific engagement.

• Minimizes the likelihood of association with a client whose management lacks integrity
• Comply with legal and ethical requirements
• Should obtain an understanding with the client regarding the nature, scope and limitations of the services to be provided.

Question 4

Leadership Responsibilities

Answer 4

Firms leadership bears ultimate responsibility for the firms quality control system and should create a culture that emphasizes quality.

Question 5

Performance

Answer 5

Achieve a consistently high level of performance.

• Ensure that the engagement is appropriately supervised and reviewed
• Allow consultation with experts inside or outside the firm with respect to complex unfamiliar issues
• Provide means to resolve differences of opinion

Question 6

Monitoring

Answer 6

Reasonable assurance that is quality control system is relevant, adequate, operating effectively and complied with in practice. A partner should bear the responsibility for the monitoring process. Peer review every 3 years.

Question 7

Ethical Requirements

Answer 7

Established to provide the firm with the reasonable assurance that personnel maintain independence in all required circumstances, perform all procession responsibilities with integrity and maintain objectivity in discharging professional responsibilities. Confirm independence annually.