Document ID: chunk:federal_register_of_legislation:F2023C01118:body:0:p61
Version: federal_register_of_legislation:F2023C01118
Segment Type: other
Provision Reference: 
Character Range: 179101–182198

or

                   + For all other engagements, an engagement team member or the engagement quality reviewer of that engagement.

           * Another type of monitoring activity had participated in designing, executing or operating the response being monitored.

A156.      In some circumstances, for example, in the case of a less complex firm, there may not be personnel who have the competence, capabilities, time or objectivity to perform the monitoring activities. In these circumstances, the firm may use network services or a service provider to perform the monitoring activities.

Evaluating Findings and Identifying Deficiencies (Ref: Para. 16(a), 40–41)

A157.      The firm accumulates findings from the performance of monitoring activities, external inspections and other relevant sources.

A158.      Information accumulated by the firm from the monitoring activities, external inspections and other relevant sources may reveal other observations about the firm's system of quality management, such as:

           * Actions, behaviours or conditions that have given rise to positive outcomes in the context of quality or the effectiveness of the system of quality management; or

           * Similar circumstances where no findings were noted (e.g., engagements where no findings were noted, and the engagements have a similar nature to the engagements where findings were noted).

    Other observations may be useful to the firm as they may assist the firm in investigating the root cause(s) of identified deficiencies, indicate practices that the firm can support or apply more extensively (e.g., across all engagements) or highlight opportunities for the firm to enhance the system of quality management.

A159.      The firm exercises professional judgement in determining whether findings, individually or in combination with other findings give rise to a deficiency in the system of quality management. In making the judgement, the firm may need to take into account the relative importance of the findings in the context of the quality objectives, quality risks, responses or other aspects of the system of quality management to which they relate. The firm's judgements may be affected by quantitative and qualitative factors relevant to the findings. In some circumstances, the firm may determine it appropriate to obtain more information about the findings in order to determine whether a deficiency exists. Not all findings, including engagement findings, will be a deficiency.
A160.      Examples of quantitative and qualitative factors that a firm may consider in determining whether findings give rise to a deficiency

 Quality Risks and Responses

           * If the findings relate to a response:

                   + How the response is designed, for example, the nature of the response, the frequency of its occurrence (if applicable), and the relative importance of the response to addressing the quality risk(s) and achieving the quality objective(s) to which it relates.

                   + The nature of the quality risk to which the response relates,