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

Mehta & Co. is planning an audit of an unlisted private company. Mr Mehta wants to decide whether an engagement quality control review is needed. Which consideration is among the criteria SQC 1 lists for engagements other than audits of listed entities?

The criterion that SQC 1 lists is whether the engagement involves a matter of public interest. Other listed criteria are unusual circumstances or risks and whether laws or regulations require a review. Fee level, length of association and team size are not named as criteria.

  1. AWhether the engagement fee is higher than the firm's average fee
  2. BWhether the client has been audited by the firm for more than five years
  3. CWhether the engagement involves a matter of public interestCorrect
  4. DWhether the engagement team has fewer than three members

Explanation

SQC 1 lists these criteria: the nature of the engagement, including the extent of public interest; unusual circumstances or risks; and whether laws or regulations require a review. Fee size, tenure and team size are not listed.

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