Document ID: chunk:federal_register_of_legislation:F2020C00630:reg:25:p8
Version: federal_register_of_legislation:F2020C00630
Segment Type: reg
Provision Reference: reg 25 (pt 8/31)
Character Range: 29084–32463

relationships and specific engagements.

(d)                Human resources.

(e)                Engagement performance.

(f)                 Monitoring.

17.               The firm shall document its policies and procedures and communicate them to the firm's personnel.  (Ref: Para. A2‑A3)

Leadership Responsibilities for Quality within the Firm

18.               The firm shall establish policies and procedures designed to promote an internal culture recognising that quality is essential in performing engagements.  Such policies and procedures shall require the firm's chief executive officer (or equivalent) or, if appropriate, the firm's managing board of partners (or equivalent) to assume ultimate responsibility for the firm's system of quality control.  (Ref: Para. A4‑A5)

19.               The firm shall establish policies and procedures such that any person or persons assigned operational responsibility for the firm's system of quality control by the firm's chief executive officer or managing board of partners has sufficient and appropriate experience and ability, and the necessary authority, to assume that responsibility.  (Ref: Para. A6)

Relevant Ethical Requirements

20.               The firm shall establish policies and procedures designed to provide it with reasonable assurance that the firm and its personnel comply with relevant ethical requirements.  (Ref: Para. A7‑A9)

Independence

21.               The firm shall establish policies and procedures designed to provide it with reasonable assurance that the firm, its personnel and, where applicable, others subject to independence requirements (including network firm personnel) maintain independence where required by relevant ethical requirements, laws and regulations.  Such policies and procedures shall enable the firm to:  (Ref: Para. A10‑Aus A10.1)

(a)                Communicate its independence requirements to its personnel and, where applicable, others subject to them; and

(b)                Identify threats to independence, evaluate whether the identified threats are at an acceptable level, and if not address them by eliminating the circumstances that create the threats, applying safeguards to reduce threats to an acceptable level, or withdrawing from the engagement, where withdrawal is possible under applicable law or regulation.

Aus 21.1 Where multiple threats to independence are identified, which individually might not be significant, the significance of those threats in aggregate and the safeguards applied or in place to eliminate some or all of the threats or reduce them to an acceptable level in aggregate, shall be evaluated.

22.               Such policies and procedures shall require:  (Ref: Para. A10‑Aus A10.1)

(a)                Engagement partners to provide the firm with relevant information about client engagements, including the scope of services, to enable the firm to evaluate the overall impact, if any, on independence requirements;

(b)                Personnel to promptly notify the firm of circumstances and relationships that create threats to independence so that appropriate action can be taken; and

(c)                The accumulation and communication of relevant information to appropriate personnel so that:

(i)                 The firm and its personnel can readily determine whether they satisfy independence requirements;