Skip to content

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

Mehta & Co. audits a private company, Lotus Foods Pvt Ltd, that is not listed. The firm's policy lists criteria for deciding which non-listed engagements need an engagement quality control review. Which of the following is a criterion SQC 1 itself identifies as relevant?

The relevant criterion is whether laws or regulations require an engagement quality control review. SQC 1 also mentions the nature of the engagement, including public interest, and unusual circumstances or risks, but not fees, partner tenure or client location.

  1. AThe amount of audit fee earned from the client
  2. BThe number of years the engagement partner has been with the firm
  3. CWhether laws or regulations require an engagement quality control reviewCorrect
  4. DThe geographical distance of the client from the firm's office

Explanation

SQC 1 lists three criteria for engagements other than listed entity audits: nature of the engagement including public interest, unusual circumstances or risks, and whether laws or regulations require a review. Fees, tenure and distance are not among them.

Did you get it right without looking?

One question tells you little. A timed set on Peer Review and Quality Review shows your real accuracy, how long you take and where you lose marks.

Practise Peer Review and Quality ReviewFree diagnostic mock

More Peer Review and Quality Review questions