PCAOB on Engagement Quality Review Flashcards
What is the purpose of the PCAOB engagement quality review?
Evaluate the judgement and conclusions of the engagement team.
It requires engagement quality review & concurring approval of report issuance
PCAOB requires engagement quality review and concurring approval of report issuance for…?
1) For an audit
2) For a review of interim financial information
What is an “associated person”?
The engagement reviewer must be an “associated person” of the registered public accounting firm.
Qualification:
1) From within the firm (partner or equivalent)
2) From outside the firm (when compensated for performing the review)
What are the characteristics of a reviewer?
- Independence
- Competent
- objectivity
- integrity
What is the “cooling off” restriction for a reviewer?
Cannot have been the partner on either of 2 audits preceding the engagement under review
What does the quality review activities do?
Discussions with team
Review documentation- Sufficient to support procedures performed and conclusions reached. It should be included with other engagement documentation and must meet retention requirements (7 years)
What is the concurring approval of issuance?
Requirement.
The public firm is prohibited from giving permission to client to use report unless the reviewer has given a “concurring approval of issuance”
The reviewer cannot issue a concurring approval of issuance if there is any significant engagement deficiency.
