— October 20, 2025 —
The Canadian Standard on Quality Management (CSQM) 1 has applied to compilation engagements since December 15, 2023. Yet, inspection results across the country indicate that many compilation-only firms are still not meeting the new requirements.
Provincial and territorial CPA bodies have been clear: quality management is a regulatory priority. For example, CPA Ontario, in a July 3, 2025 notice to its members, reported that practice inspections continue to reveal significant deficiencies in firms’ Systems of Quality Management (SoQMs) for compilation engagements. Other provincial bodies are making similar observations.
The message is the same nationwide — compliance is not optional, and the time to act is now.
—
Common Gaps in Compilation-Only Practices
Practice inspections and regulator reviews have revealed recurring weaknesses specific to compilation engagements:
- Governance and Leadership – In many small firms, leadership’s commitment to quality is informal and undocumented, with no clear partner oversight of quality responsibilities.
- Ethical Requirements – Independence confirmations are sometimes missed, and whistleblower policies are absent or incomplete.
- Engagement Performance – File documentation is often thin, with insufficient records of procedures performed and professional judgment applied. Late assembly and archiving beyond the 60-day requirement remain frequent
- Resources – Outdated templates and checklists, and CPD that is unrelated to compilation work, weaken quality.
- Monitoring and Remediation – Monitoring is not always risk-based or representative of the firm’s client base, and reviewers may lack appropriate technical skills.
—
Why This Matters for Compilation Engagements
Some compilation-only firms assumed CSQM 1 was designed mainly for audits and reviews. In reality, the same eight quality management components—from governance to monitoring—apply equally to compilation engagements.
While a scaled approach is permitted, the quality objectives, risk assessment, and documentation requirements still apply. Regulators are clear: shortcuts are not acceptable.
—
Take Action Now
Review your SoQM – Identify and close gaps in governance, ethics, engagement performance, resources, and monitoring.
Update documentation – Ensure templates, checklists, and policies are current and aligned with CSQM 1 requirements.
Target CPD – Focus professional development on compilation-specific quality management.
Engage in monitoring – Select reviewers with the right technical skills and review a representative sample of compilation files.
—
Register today for our courses that address this topic. They are designed to help give you the clarity, tools, and confidence to ensure your SoQM meets the CSQM standard and stands up to regulatory inspection.
Quality Management Update – 2025
Quality Management Unplugged: Surviving CSQM and practice inspection – The Recorded Version
Quality Management – Customizing your Quality Assurance Manual and designing monitoring activities
