Document ID: chunk:federal_register_of_legislation:F2023C01118:body:0:p55
Version: federal_register_of_legislation:F2023C01118
Segment Type: other
Provision Reference: 
Character Range: 161712–164875

estimation uncertainty (e.g., certain large financial institutions or mining entities), or for entities for which uncertainties exist related to events or conditions that may cast significant doubt on their ability to continue as a going concern.

              + Assurance engagements that require specialised skills and knowledge in measuring or evaluating the underlying subject matter against the applicable criteria (e.g., a greenhouse gas statement in which there are significant uncertainties associated with the quantities reported therein).

      * Engagements on which issues have been encountered, such as audit engagements with recurring internal or external inspection findings, unremediated significant deficiencies in internal control, or a material restatement of comparative information in a financial report.

      * Engagements for which unusual circumstances have been identified during the firm's acceptance and continuance process (e.g., a new client that had a disagreement with its previous auditor or assurance practitioner).

      * Engagements that involve reporting on financial or non-financial information that is expected to be included in a regulatory filing, and that may involve a higher degree of judgement, such as pro forma financial information to be included in a prospectus.

Those relating to the types of entities for which engagements are undertaken:

      * Entities in emerging industries, or for which the firm has no previous experience.

      * Entities for which concerns were expressed in communications from securities or prudential regulators.

      * Entities other than listed entities that may have public interest or public accountability characteristics, for example:

              + Entities that hold a significant amount of assets in a fiduciary capacity for a large number of stakeholders including financial institutions, such as certain banks, insurance companies, and superannuation funds for which an engagement quality review is not otherwise required by law or regulation.

              + Entities with a high public profile, or whose management or owners have a high public profile.

              + Entities with a large number and wide range of stakeholders.

A135.      The firm's responses to address quality risks may include other forms of engagement reviews that are not an engagement quality review. For example, for audits of financial reports, the firm's responses may include reviews of the engagement team's procedures relating to significant risks, or reviews of certain significant judgements, by personnel who have specialised technical expertise. In some cases, these other types of engagement reviews may be undertaken in addition to an engagement quality review.

A136.      In some cases, the firm may determine that there are no audits or other engagements for which an engagement quality review or another form of engagement review is an appropriate response to address the quality risk(s).

Public sector considerations

A137.      The nature and circumstances of public sector entities (e.g., due to their size and complexity, the range of their stakeholders, or