CA Final · Advanced Auditing, Assurance and Professional Ethics · Related Services
Partner CA Neha of Neha & Associates is asked to accept a compilation engagement for a client. A junior asks whether the firm's quality control obligations apply since the engagement is not an audit or review. What is the correct position under SRS 4410 (Revised)?
SQC 1 applies. It deals with the firm's responsibility to establish and maintain a system of quality control for related services engagements, including compilation engagements, through policies and procedures to achieve its objective and monitor compliance. Absence of assurance does not remove the firm's quality control obligations.
- ASQC 1 does not apply because compilation engagements provide no assurance
- BSQC 1 deals with the firm's responsibilities to establish and maintain its quality control system for related services engagements, including compilation engagementsCorrect
- CSQC 1 applies only if the compilation is for a listed company
- DSQC 1 is replaced entirely by the compilation standard, so no firm-level system is needed
Explanation
SRS 4410 (Revised) explains its relationship with SQC 1: SQC 1 deals with the firm's responsibilities to establish and maintain its system of quality control for related services engagements, including compilations. These responsibilities cover the quality control system, the related policies and procedures to implement and monitor compliance. The no-assurance argument is therefore wrong.
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