ACCM4400 Assignment: Analyzing ASA 220 Quality Control Standard

This essay provides a detailed analysis of ASA 220, the auditing standard issued by the Australian Accounting Standards Board (AASB) regarding quality control for financial report audits. The essay explores the standard's objectives, which include establishing requirements and providing explanatory materials for auditors' responsibilities in quality control procedures. It highlights the role of the engagement partner in ensuring quality audits and the importance of ethical requirements. The essay examines key aspects of ASA 220, such as the auditor's aim for implementing quality control procedures at the engagement level to provide reasonable assurances. It also discusses the engagement team's responsibilities and the importance of monitoring processes to ensure compliance with quality control systems. The essay references relevant guidelines and requirements for the effective implementation of the standard, emphasizing the need for proper documentation and the continuous evaluation of the quality control system's effectiveness. Finally, the essay includes references to the standard and related documents.

AUDITING AND
ASSURENCE

 The AASB that is Australian Accounting Standards Board is the Australian
Government agency, which is responsible for the development as well as
maintaining the standards of the financial reporting that are applicable for the
organizations in the sectors of private and public of the Australian economy.
 This independent board of the standard setting of IFA has issued the standard
of auditing that is ASA 220 for Quality control for financial statements audit.
 The main aim of the standards of auditing is to establish requirements and
providing with the other explanatory materials and applications, which help in
dealing with given auditors responsibilities for the procedures of the control of
quality for the company’s financial reports audit and the other historical
financial information.
 AASB has issued ISA 220 that deals with the specific responsibilities of the
auditors in relation to the procedures of the quality control for audit of
financial reports as well as other historical financial information.
 As per AASB, this standard helps in addressing the responsibilities of the
engagement reviewer of quality control, where applicable. Hence, this
assignment would be analyzing the standards of auditing ASA 220 in depth,
issued by AASB.
Introduction

 In order to provide quality audits, the auditing standard provides the
guidelines for the engagement partners for having leadership
responsibilities.
 It provides the relevant ethical requirements with the help of setting
assignments for audit of the engagement by the engagement
partners.
 The guidelines sets out the requirements of engagements
performance, which is consist of reviews of quality control,
consultations and reviews by the supervision.
 It helps in explaining the monitoring processes in order to comply
with quality control system with the help of establishment of the
documentations requirements, which are related to the engagement
reviewer of quality control(ASA220 2019).
 The auditors aim for implementing quality control procedures in the
organizations at engagement level that ultimately helps auditors to
have reasonable assurances.
Quality Control for Financial Reports and the Other Historical Financial
Information Auditing

 The system of the quality control as well as applicable policies as well as
procedures is the responsibilities of the firm of audit.
 In order to provide with the reasonable assurances, the organization are
obliged to maintain and establish the system of quality assurances.
 Further, engagements teams are responsible to implement the procedures
of the quality control, which are applicable for audit engagements as well
as to provide the company with the relevant information for enabling
functionality of the part of quality control system, which are in context to
independence.
 In addition, the teams of engagement are entitled for having reliance on
the system of the quality control of the company until and unless
information is provided by the organization or otherwise suggested by the
other parties(ASA220 2019).
 The auditors aim for implementing quality control procedures in the
organizations at engagement level that ultimately helps auditors to have
reasonable assurances.
Quality Control and the Role of Engagement Teams System

 The engagement partner takes the desired quality
responsibilities for every assigned audit
engagements.
 In case of the ethical issues that come in
consideration by the ethical partner of the
company‘s quality control system.
 It helps in indicting that the engagement team
members does not comply with required
requirements of the relevant ethics and by the
consultations with others in the organization, the
partner of engagement have to take action
against appropriate situations (ASA220 2019).
ASA 220 Requirements

 There needs satisfaction from the engagements partners regarding
possessing of the competencies as well as capabilities to perform audit
engagements by the engagement teams and auditors experts, in accordance
with applicable regulatory law and regulations, ethical requirements and
requirements of Australian auditing standards.
 The effectiveness of the system of the quality control are comprised of the
monitoring processes to provide the organizations with the assurances that
are reasonable that the policies as well as the procedures in context of
systems of the quality control are operating effectively, relevant and is
adequate.
 In the latest circulated information of the company, the partner of the
engagements should consider the result of monitoring process of the
company.
 Moreover, auditors should maintain proper documentations in relation to
issues of compliances, compliance conclusion, conclusion regarding audit
engagements continuation, relationship with the clients and reviewed audit
engagements (ASA2202019).
Continued…

 ASA 2019, ASA 220 - Quality Control for Audits of
Historical Financial Information - April 2006.
[online] Available at:
https://www.legislation.gov.au/Details/F2006L0136
5 [Accessed 1 Sep. 2019].
 Auditing Standard ASA 2019, ASA 220 Quality
Control for an Audit of a Financial Report and
Other Historical Financial Information..[ebook]
Available at:
https://www.auasb.gov.au/admin/file/content102/c
3/Nov13_Compiled_Auditing_Standard_ASA_220.p
df [Accessed 1 Sep. 2019].
Reference