ACCA Strategic Professional · Advanced Audit and Assurance (International) · International regulatory frameworks for audit and assurance services
During the audit of Orion Ltd, the engagement partner, Lena, delegated the review of the inventory working papers to a senior manager. She then signed the audit report after only reading the summary memo, without involvement in significant areas such as going concern. Which ISA 220 (Revised) requirement has Lena failed to meet?
Lena failed the ISA 220 (Revised) requirement that the engagement partner take overall responsibility for engagement quality and be sufficiently and appropriately involved throughout, including reviewing significant areas and judgements. Delegating tasks is allowed, but signing the report based only on a summary memo does not meet this responsibility.
- AShe did not take overall responsibility for managing and achieving quality, including being sufficiently and appropriately involved throughout the engagement, with direction, supervision and review responsibilityCorrect
- BShe failed to perform the engagement quality review personally, which ISA 220 requires of the engagement partner
- CShe did not obtain written representations from the senior manager that the working papers were complete
- DShe did not rotate off the engagement after the first year
Explanation
ISA 220 (Revised) makes the engagement partner responsible for overall quality and requires sufficient and appropriate involvement throughout, including review of significant areas and judgements. Work may be assigned to others, but the partner cannot rely on a summary alone. The EQR is a separate person, so the second option is wrong.
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