Document ID: chunk:federal_register_of_legislation:F2023C01118:body:0:p54
Version: federal_register_of_legislation:F2023C01118
Segment Type: other
Provision Reference: 
Character Range: 158858–162002

the firm's website).

A132.      The firm uses professional judgement in determining, in the circumstances, the appropriate form of communication with the external party, including communication with those charged with governance when performing an audit of a financial report of listed entities, which may be made orally or in writing. Accordingly, the form of communication may vary.
Examples of form of communication to external parties

      * A publication such as a transparency report or audit quality report.

      * Targeted written communication to specific stakeholders (e.g., information about the results of the firm's monitoring and remediation process).

      * Direct conversations and interactions with the external party (e.g., discussions between the engagement team and those charged with governance).

      * A webpage.

      * Other forms of digital media, such as social media, or interviews or presentations via webcast or video.

Engagements Subject to an Engagement Quality Review

Engagement Quality Review Required by Law or Regulation (Ref: Para. 34(f)(ii))

A133.      Law or regulation may require an engagement quality review to be performed, for example, for audit engagements for entities that:

           * Are public interest entities as defined in a particular jurisdiction;

           * Operate in the public sector or which are recipients of government funding, or entities with public accountability;

           * Operate in certain industries (e.g., financial institutions such as banks, insurance companies and superannuation funds);

           * Meet a specified asset threshold; or

           * Are under the management of a court or judicial process (e.g., liquidation).

Engagement Quality Review as a Response to Address One or More Quality Risk(s) (Ref: Para. 34(f)(iii))

A134.      The firm's understanding of the conditions, events, circumstances, actions or inactions that may adversely affect the achievement of the quality objectives, as required by paragraph 25(a)(ii), relates to the nature and circumstances of the engagements performed by the firm. In designing and implementing responses to address one or more quality risk(s), the firm may determine that an engagement quality review is an appropriate response based on the reasons for the assessments given to the quality risks.
Examples of conditions, events, circumstances, actions or inactions giving rise to one or more quality risk(s) for which an engagement quality review may be an appropriate response

Those relating to the types of engagements performed by the firm and reports to be issued:

      * Engagements that involve a high level of complexity or judgement, such as:

              + Audits of financial reports for entities operating in an industry that typically has accounting estimates with a high degree of 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