Quality Management - New Responsibilities for Firms - 2022
Since 2005, public accounting firms have been required to develop and maintain a “Quality Assurance Manual” (QAM) which sets out that firm’s policies designed to provide an adequate level of control over the quality of work performed in assurance engagements.
In recent years, the rules regarding this system of quality control were found in section CSQC 1 of the CPA Canada Handbook – Assurance (“Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance Engagements”).
Starting in December 2022, the requirements of CSQC 1 are being replaced by those found in three new Handbook sections:
- CSQM 1 – Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Service Engagements
- CSQM 2 – Engagement Quality Reviews • Canadian Auditing Standard (CAS) 220 – Quality Management for an Audit of Financial Statements
Unlike the previous rules, these new requirements not only apply to audit and review engagements but also to compilations and other types of engagements. As a result, firms which only perform compilation engagements will also now have to develop and document their quality management policies. For all firms, their QAM must be updated so that their policies are based on an assessment of quality objectives and risks specific to each firm.
This course will introduce participants to the requirements of the new quality management Handbook sections and their effective dates.
The primary goal of the course is to enable participants to develop their own customized QAM policies, without the need to rely on generic forms, in the following areas required by CSQM 1:
- The firm’s risk assessment process
- Governance and leadership • Relevant ethical requirements
- Client acceptance and continuance
- Engagement performance
- Information and communication
- The monitoring and remediation process
Participants will be encouraged during the discussion to raise specific areas of concern for their firms arising from the new quality management requirements
David Baker CPA, CA
David Baker earned his CA designation in 1981, earning an award as a top UFE writer in the Waterloo Region. In 1983 he began his own public accounting practice in Elmira, Ontario serving local small and medium-sized owner-managed businesses