Excel for
Chartered Accountants
Under Sec. 28A of the Chartered Accountants Act, 1949, as amended by Chartered Accountants (Amendment) Act, 2006, the Central Government is empowered to constitute a Quality Review Board (QRB). The Chairperson and members of the Board are appointed from amongst the persons of eminence having experience in the field of law, economics, business, finance or accountancy. Five members of the Board are nominated by the Council of the Institute of Chartered Accountants of India (ICAI) and the Chairperson and other five members are nominated by the Central Government.
The first Quality Review Board was constituted by the Central Government by Notification GSR. 448 (E) dated 28th June, 2007. The QRB has since been re-constituted several time.
Apart from the five representatives of the Council of the Institute of Chartered Accountants of India, the composition of the Board also incorporates representatives from the Ministry of Corporate Affairs, Government of India, Comptroller & Auditor General of India, Securities & Exchange Board of India, Ministry of Law. The other two Government nominees on the Board are the Chairperson, Quality Review Board, a retired Indian Revenue Service Officer of the Government of India and formerly Chairman, Central Board of Direct Taxes, Ministry of Finance, Government of India, and the other one a practicing chartered accountant from Hyderabad.
Empanelment of Chartered Accountants as Technical Reviewers
The QRB empanelled 32 and 61 Chartered Accountants as Technical Reviewers with the Quality Review Board for the financial year 2012-13 and 2013-14 respectively. Again, 78 Chartered Accountants were empanelled for the financial years 2014-15 to 2016-17.
Selection of Audit firms for Quality Reviews- The selection criteria has been woven around NSE CNX 500 S&P BSE 500 index. The Board may select statutory auditors for Quality Review on a reference made to it by any regulatory body like Reserve Bank of India, Securities and Exchange Board of India, Insurance Regulatory and Development Authority, Ministry of Corporate Affairs etc. The Board may also select, on case to case basis, statutory auditors in respect of those companies in relation to which serious accounting irregularities or likelihood of fraud in the financial statements may have been highlighted by the media and other reports.
Quality Review Assignment Offered-D uring financial year 2012-13, 2013-14 and 2014-15 a total of 37, 56 and a total of 123 Quality Review (QR) assignments were offered to the Technical Reviewers.
Quality review Stages:
1. Selection of Audit Firm and Technical Reviewer to conduct Quality Review and sending Offer Letter of Engagement to the Technical Reviewer.
2. Technical Reviewer to convey his acceptance of Letter of Engagement by sending necessary declarations for meeting eligibility conditions and furnishing statement of confidentiality by the Technical Reviewer and his assistant/s, if any.
3. Intimation to the Audit Firm about the proposed Quality Review and acceptance of the assignment by the Technical Reviewer.
4. Technical Reviewer to send the specified Quality Review Program General Questionnaire to the Audit firm for filling-up and call for additional information from the Audit Firm, if required.
5. Technical Reviewer to carry out the Quality Review by visiting the office of the Audit Firm by fixing the date as per mutual consent.
6. Technical Reviewer to send the preliminary report to Audit firm.
7. Audit firm to submit representation on the preliminary report to the Technical Reviewer.
8. Technical Reviewer to submit Final report, as the case may be, to the Quality Review Board enclosing therewith the specified Annexures also sending a copy of his final report to the Audit firm requesting them to send their submissions thereon directly to the Board within a specified period.
9. Quality Review Group to consider the report of the Technical Reviewer and responses of the Audit firm, if any.
10. Quality Review Board to consider the report of the Quality Review Group and make recommendations.
Report on Audit Quality Review:- Quality Review Board has brought out ‘A Report on Audit Quality Review Findings (2012-15)’ providing analysis and summary of observations made by the Technical Reviewers in review reports completed during the financial years 2012-15. The highlights of the observations are as under:
Observations of the Technical Reviewers
|
Standards on Auditing |
|
|
|
SA 200- Overall objectives of the independent auditor and the conduct of an audit in accordance with standards on auditing |
|
|
|
|
|
Sa 220- Quality control for an audit of financial statements |
|
|
|
|
|
SA 299- Responsibility of joint auditors |
|
|
|
|
|
SA 315-Identifying and assessing the risk of material misstatement through understanding the entity and its environment |
|
|
SA 320- Materiality in planning and performing an audit |
|
|
SA 330- Auditor’s responses to assessed risks |
|
|
|
|
|
SA 505- External confirmations |
|
|
SA 520- Analytical procedures |
|
|
SA 530- Audit sampling |
|
|
SA 540 “Auditing accounting estimates, including fair value accounting estimates and related disclosures" |
|
|
SA 550- Related parties |
|
|
SA 580 Written representations |
|
|
SA 600 Using the work of another auditor |
|
|
SA 610 Using the work of internal auditors |
|
|
SA 620-using the work of an auditor’s expert |
|
|
SA 700 Forming an opinion and reporting on financial statements |
|
|
SA 706 Emphasis of matter paragraphs and other matter paragraphs in the independent auditor’s report |
|
|
SA 710 Comparative information—corresponding figures and comparative financial statements |
|
|
SA 720 Auditor’s responsibility in relation to other information in documents containing audited financial statements |
|
|
|
|
Relevant Laws and Regulations |
|
Download Full Report Click Here>>
Quality Review Board QRB Report on Audit Quality Review Findings 2012-15 providing analysis and summary of observations made by Technical Reviewers |18-08-2015|
