Document ID: chunk:federal_register_of_legislation:F2023C01118:body:0:p29
Version: federal_register_of_legislation:F2023C01118
Segment Type: other
Provision Reference: 
Character Range: 85173–88375

matters related to independence so that a robust and consistent approach is designed and implemented by the firm to deal with independence requirements.

A37.         Law, regulation or AUASB standards may establish additional requirements for an individual assigned responsibility for a matter(s) in paragraph 20, such as requirements for professional licensing, professional education or continuing professional development.

A38.         The appropriate experience and knowledge for the individual(s) assigned operational responsibility for the system of quality management ordinarily includes an understanding of the firm's strategic decisions and actions and experience with the firm's business operations.

The Firm's Risk Assessment Process (Ref: Para. 23)

A39.         How the firm designs the firm's risk assessment process may be affected by the nature and circumstances of the firm, including how the firm is structured and organised.
Scalability examples to demonstrate how the firm's risk assessment process may differ

      * In a less complex firm, the individual(s) assigned operational responsibility for the system of quality management may have a sufficient understanding of the firm and its engagements to undertake the risk assessment process. Furthermore, the documentation of the quality objectives, quality risks and responses may be less extensive than for a more complex firm (e.g., it may be documented in a single document).

      * In a more complex firm, there may be a formal risk assessment process, involving multiple individuals and numerous activities. The process may be centralized (e.g., the quality objectives, quality risks and responses are established centrally for all business units, functions and service lines) or decentralized (e.g., the quality objectives, quality risks and responses are established at a business unit, function or service line level, with the outputs combined at the firm level). The firm's network may also provide the firm with quality objectives, quality risks and responses to be included in the firm's system of quality management.

A40.         The process of establishing quality objectives, identifying and assessing quality risks and designing and implementing responses is iterative, and the requirements of this ASQM are not intended to be addressed in a linear manner. For example:

           * In identifying and assessing quality risks, the firm may determine that an additional quality objective(s) needs to be established.

           * When designing and implementing responses, the firm may determine that a quality risk was not identified and assessed.

A41.         Information sources that enable the firm to establish quality objectives, identify and assess quality risks and design and implement responses form part of the firm's information and communication component and include:

           * The results of the firm's monitoring and remediation process (see paragraphs 42 and A171).

           * Information from the network or service providers, including:

                   + Information about network requirements or network services (see paragraph 48); and

                   + Other information