CA Final · Advanced Auditing, Assurance and Professional Ethics · Quality Control

Kapoor & Co. circulates its quality control policies to all staff by email once and instructs that only partners should raise any concerns about the system. A senior says the firm has met its communication responsibility. Which view is correct under SQC 1?

The view is not correct. SQC 1 expects the firm to document and communicate its quality control policies and objectives to its personnel, stress each person's personal responsibility for quality, and encourage personnel to communicate views or concerns, not limit this to partners.

1. ACorrect, because communication of policies to partners alone is enough
2. BNot correct, because the firm should communicate policies and objectives to its personnel, convey that each individual has personal responsibility for quality, and encourage personnel to voice views or concernsCorrect
3. CCorrect, because feedback from personnel is prohibited by SQC 1
4. DNot correct, because policies must be communicated only to the client's management