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Engagement quality control reviews are an objective evaluation of significant matters, including identified risks and significant judgments made by the engagement team, and the team’s conclusions reached in formulating the engagement report. A quality reviewer performs his or her review in a timely manner at appropriate stages of the audit. An assurance report is not dated until the completion of the engagement quality control review. This section describes the process for selecting which assurance engagements require a quality reviewer and the appointment of quality reviewers.
An engagement quality control review shall be required and a quality reviewer will be assigned for all financial audits of a listed entity. [Jun-2018] The assignment of a quality reviewer for all other assurance engagements shall be based on the level of risk associated with the assurance engagement. [Nov-2011] The Assistant Auditor General, Audit Services shall approve engagement quality control reviews and assignments. [Sep-2014]
The Assistant Auditor General, Audit Services, is responsible for evaluating all assurance engagements and approving engagement quality control review assignments. He or she will consider the Selection Criteria in this guidance and consult with the assistant auditors general of the applicable practice when evaluating the level of risk associated with an assurance engagement. The Assistant Auditor General, Audit Services, completes this process at least annually and revisits it as new risk factors or changes in circumstances arise. An engagement quality control review is required and a quality reviewer will be assigned for all financial audits of a listed entity. For purposes of complying with this policy, listed entities are those entities whose shares, stock or debt are quoted or listed on a recognized stock exchange, or are marketed under the regulations of a recognized stock exchange or other equivalent body. The assignment of an engagement quality control review for all other assurance engagements will be based on the evaluation and documentation of the level of risk associated with the assurance engagement done by the Assistant Auditor General, Audit Services. The assurance engagements assessed at an acceptable level of risk to the Office will not require an engagement quality control review. Selection criteriaThe Assistant Auditor General, Audit Services, considers (a) the nature of the entity and engagement and (b) any unusual engagement circumstances and risks when evaluating the level of risk associated with an assurance engagement. Criteria to assess the nature of the entity and engagement
Criteria to assess unusual engagement circumstances and risks
During the course of an assurance engagement, if an engagement leader identifies new risk factors or changes in circumstances that lead them to believe that an engagement quality control review would be beneficial, they should communicate these concerns to the Assistant Auditor General, Audit Services, in a timely manner. The appointment and eligibility of the engagement quality control reviewerThe Assistant Auditor General, Audit Services, is responsible for identifying eligible individuals to be appointed as quality reviewers. He or she will consider the criteria established in this policy and consultations when identifying an eligible quality reviewer. This process will be completed at least annually and revisited as threats to the quality reviewer’s objectivity or changes in circumstances arise. The Assistant Auditor General, Audit Services, will apply professional judgment and consider the assessed level of risk for the assurance engagement when identifying one or more individuals with sufficient and appropriate authority to fulfill the role of quality reviewer. The Assistant Auditor General, Audit Services, considers the following eligibility criteria when identifying individuals for appointment as quality reviewers:
The quality reviewer should be, and be seen to be, free of influences that would impair his or her objectivity from the engagement and the entity (OAG Audit 3031 Independence and OAG Audit 1071 Job rotation). During the quality reviewer selection process, the Assistant Auditor General, Audit Services, may identify potential threats to the quality reviewer’s objectivity, independence, and authority. Where threats are considered significant, the Assistant Auditor General, Audit Services, may choose to identify, document, and apply safeguards to reduce threats to an acceptable level. OAG Audit 3063 Quality reviewer responsibilities addresses the degree to which an engagement quality control reviewer can be consulted on the engagement without compromising the reviewer’s objectivity. |