Page 66 - AAA Integrated Workbook STUDENT S18-J19

Chapter 5

4.3 Review responsibilities

Consideration of whether:

 The work has been performed in accordance with professional standards

 Appropriate consultations have taken place

 The work performed supports the conclusions reached

 The evidence obtained is sufficient and appropriate to support the auditor's
report.

 The objectives of the engagement procedures have been achieved.

The engagement partner should perform a review of critical areas of judgment,
significant risks and other areas of importance throughout the audit.

The extent and timing of the partner's reviews should be documented

4.4 Engagement quality control review

Listed entities and other high risk clients should be subject to an engagement quality
control review (EQCR). This is also referred to as a pre-issuance review or 'Hot'
review.

High risk clients include those which are in the public interest, those with unusual
circumstances and risks, and those where laws or regulations require an EQCR.

An EQCR includes:

 Discussion of significant matters with the engagement partner.

 Review of the financial statements and proposed auditor’s report.

 Review of selected audit documentation relating to significant judgments and
conclusions reached. This includes:

– Significant risks and responses to those risks

– Judgments with respect to materiality and significant risks

– Significance of uncorrected misstatements

– Matters to be communicated to management and those charged with
governance, and where applicable, other parties such as regulatory
bodies.

– Evaluation of conclusions reached in forming the audit opinion.

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