The American Institute of CPAs’ (AICPA) Auditing Standards Board (ASB) has issued the exposure draft (ED) Proposed Quality Management Standards. The changes proposed are, in part, responses to peer review findings. The changes are significant and apply to all firms with an accounting and auditing practice.
Though the Auditing Standards Board (ASB) has designed the new standards to be scalable to different sized firms, as proposed your firm will need to change its system of quality control to incorporate a new system of quality management. In addition, while many of the required changes could be minor, some changes required may likely be significant.
For example, current standards allow engagements to be inspected by a member of the engagement team (self-inspection). Under the proposed standard this would be prohibited; thus, many smaller firms will be required to engage individuals outside the firm to perform annual inspections.
The ASB is interested in feedback. And as a result of feedback, changes to the proposal will be considered. It is vitally important for firms to respond to the proposal for the ASB to accomplish its objective and to allow the ASB to effectively evaluate the impact of the proposed standards on firms of all sizes.
Submit and Share Your Comments
Responses are due to CommentLetters@aicpa-cima.com by August 31.
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