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CS Professional · Compliance Management, Audit and Due Diligence · Peer Review and Quality Review

Gupta & Partners audits Vedanta Agro Ltd, an unlisted company. A law applicable to a class of such entities requires an engagement quality control review for their audits. How should the firm treat this under SQC 1 criteria?

The firm must subject the audit to a review. SQC 1 lists whether laws or regulations require an engagement quality control review as a criterion for engagements other than listed-entity audits, and engagements meeting the firm's criteria must receive the review.

  1. AThe legal requirement is a criterion the firm considers, so an engagement meeting it must be subject to a reviewCorrect
  2. BThe legal requirement is irrelevant because only listed entity audits need a review
  3. CThe legal requirement matters only if the engagement involves no public interest
  4. DThe legal requirement permits a review after the report is issued

Explanation

Among criteria for engagements other than listed-entity audits is whether laws or regulations require an engagement quality control review. Engagements meeting the firm's criteria must be reviewed. Option B is wrong because criteria exist precisely for other engagements.

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