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ACCA Strategic Professional · Advanced Audit and Assurance (International) · Quality management (firm and engagement level)

Harlow & Dunn, an audit firm, has implemented a system of quality management under ISQM 1. The managing partner asks which component of the system deals with evaluating whether the system is operating effectively and identifying deficiencies. Which component is this?

The monitoring and remediation process is the ISQM 1 component that evaluates whether the quality management system is designed, implemented and operating effectively, and identifies deficiencies so the firm can take corrective action. The other components support the system's operation rather than assess it.

  1. AThe monitoring and remediation processCorrect
  2. BThe resources component
  3. CThe information and communication component
  4. DThe engagement performance component

Explanation

ISQM 1 includes a monitoring and remediation process that provides relevant, reliable and timely information about the design, implementation and operation of the system and enables the firm to take action to respond to deficiencies. The other components support operation of the system but do not evaluate it.

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