Document ID: chunk:federal_register_of_legislation:F2025L00107:front:0:p68
Version: federal_register_of_legislation:F2025L00107
Segment Type: other
Provision Reference: 
Character Range: 226565–229933

and

         8.                 The monitoring and remediation process.

Firms or legislative or other requirements may use different terminology or frameworks to describe the components of the system of quality management.

 1.          A firm's system of quality management includes establishing a monitoring and remediation process designed to:

           * Provide the firm with relevant, reliable and timely information about the design, implementation, and operation of the system of quality management.

           * Take appropriate actions to respond to identified deficiencies such that deficiencies are remediated by the firm on a timely basis.

 1.          Ordinarily, the engagement team may depend on the firm's system of quality management unless:

           * The engagement team's understanding or practical experience indicates that the firm's policies or procedures will not effectively address the nature and circumstances of the engagement; or

           * Information provided by the firm or other parties about the effectiveness of such policies or procedures suggests otherwise.

For example, the engagement team may depend on the firm's system of quality management in relation to:

           * Competence and capabilities of personnel through their recruitment and formal training.

           * Independence through the accumulation and communication of relevant independence information.

           * Maintenance of client relationships through the firm's policies or procedures for acceptance and continuance of client relationships and assurance engagements.

           * Adherence to regulatory and legal requirements through the firm's monitoring and remediation process.

 1.          Professional requirements, or requirements in law or regulation, that deal with the firm's responsibilities to design, implement, and operate a system of quality management are at least as demanding as ASQM 1 when they address all the matters referred to in paragraphs A69–A71 and impose obligations on the firm that achieve the aims of the objectives and requirements of ASQM 1.

 2.          An appropriate authority could be a national standard setter, regulator, or oversight body with responsibility for audit, assurance or related relevant ethical requirements, or a designated accreditation organisation recognised by a public authority.

Engagement-level Quality Management

Overall Responsibility for Managing and Achieving Quality (Ref: Para. 31–32)

 1.          Taking overall responsibility for managing and achieving quality on the engagement and being sufficiently and appropriately involved throughout the engagement may be demonstrated by the engagement leader in various ways, including:

           * Involvement in the acceptance and continuance process to be able to determine that the firm's policies or procedures for the acceptance and continuance of client relationships and assurance engagements have been followed.

           * The engagement being planned and performed (including appropriate direction and supervision of engagement team members) in accordance with professional standards or requirements and applicable legal and regulatory requirements.

           * Reviews being performed in accordance with the firm's policies or procedures and reviewing the engagement documentation on or before the date of