Peer Review
This query is : Resolved
28 June 2009
Can someone pls guide me when a C.A. firm is selected for Peer Review audit, what are the requirements the C.A. firm should fulfill & keep ready for verification by the Peer Review auditors ? Is there any draft checklist or questionnaire which could help us in checking if all files & office documents are ready & in order which are going to be checked ? Urgent reply required.
28 June 2009
1)A questionnaire is sent by the reviewwer which has to be submitted to him, wherefrom they select the clients which they check in depth. That questionnaire contains basic information about the firm under review and client details alongwith attestaion feees charged and also type of services rendered.
2) Apart form above article related issues e.g.., attenance and diary sheet, leave application etc. is checked by the reviewer
2) Apart form above article related issues e.g.., attenance and diary sheet, leave application etc. is checked by the reviewer
28 June 2009
PL GO THROUGH THE FOLLOWING .CONTAINS INFORMATION ABOUT PEER REVIEW.
Peer review visits will be conducted at the practice unit's head office or other officially noted/ recorded place of office. The complete on-site review of a practice unit may take at least a full day depending upon the size of the practice unit. This is based on the assumption that the practice unit concerned has made all the necessary information and documentation available to the reviewer for his review. However, in any case this on-site review should not extend beyond seven working days.
Initial meeting
1. An initial meeting will be held between the reviewer and a partner/ sole proprietor of the practice unit designated to deal with the review (designated partner). The primary purpose of this meeting is to confirm the accuracy of the responses given in the Questionnaire. The description of the system in the Questionnaire may not fully explain all the relevant procedures and policies adopted by the practice unit and this initial meeting can provide additional information. The reviewer should have a full understanding of the system and be able to form a preliminary evaluation of its adequacy at the conclusion of the meeting.
2. Large practice units which have extensive documentation regarding their practice and procedures (i.e. formal office procedure manuals and audit manuals) will find it unnecessary to document all the controls and will be expected to cross reference the Questionnaire to the relevant sections of their manuals. For practices like these an additional planning visit will be arranged before the on-site review to review the relevant manuals.
Compliance Review-General Controls
1. The reviewer may carry out a compliance review of the General Controls and evaluate the degree of reliance to be placed upon them. The degree of reliance will, ultimately, affect the attestation services engagements to be reviewed.
The following five key controls will be considered as General Controls:
*
Independence
*
Maintenance of Professional Skills and Standards
*
Outside Consultation
*
Staff Supervision and Development
*
Office Administration
'Practice units are expected to address each of the five key control areas'
2. In each key control area there shall be supplementary questions and matters to consider. These are intended to ensure that the kind of controls that are expected to be maintained, are installed and operated within practice units.
3. All questions in the questionnaire may not necessarily be relevant to particular types of practice units because of their size and culture etc. However, practice units should still assess their internal control systems to ascertain whether they address the objectives under the five key control areas.
4. Selection of attestation services engagements to be reviewed
1. The number of attestation services engagements to be reviewed depends upon :
*
The number of practicing members involved in attestation services engagements in the practice unit;
*
The degree of reliance placed, if any, on general quality controls; and
*
The total number of attestation services engagements undertaken by the practice units for the period under review.
2. From the initial sample selected at the planning stage, the reviewer, in consultation with the practice unit, may reduce the initial sample to a smaller actual sample of attestation services engagements for review. The engagements reviewed should be a balanced sample from a variety of different sized clients covering various industries so that they reflect the overall performance of a practice unit. Accordingly, if the reviewer onsiders that the actual sample is not representative of the practice units attestation services client portfolio, he may make further selections from the initial sample or from the complete attestation services client list.
5. Review of records
The reviewer may adopt a compliance approach or substantive approach or a combination of both in the review of attestation services engagement records.
1. Compliance approach-Attestation services Engagements
*
The compliance approach is to assess whether proper control procedures have been established by the practice unit to ensure that attestation services are being performed in accordance with Technical Standards.
The following six key controls shall be considered:
o
Audit Record Administration
o
Financial Statements Presentation
o
Review and Evaluation of System of Internal controls
o
Substantive Tests
o
Audit Conclusion
o
Audit Report
*
Practice units should have procedures and documentation sufficient to cover each of the key control areas. Members in smaller practices may find some of the documentation too elaborate for most of their clients and so should tailor their attestation services documentation to suit their particular circumstances with justification for doing so provided to the reviewer.
2. Substantive approach-Attestation services Engagements
A substantive approach will be employed if the reviewer chooses not to place reliance on the practice unit's specific controls on attestation engagements or is of the opinion that the standard of compliance is not satisfactory. This approach requires a review of the attestation working papers in order to establish whether the attestation work has been carried out as per norms of Technical Standards.
Peer review visits will be conducted at the practice unit's head office or other officially noted/ recorded place of office. The complete on-site review of a practice unit may take at least a full day depending upon the size of the practice unit. This is based on the assumption that the practice unit concerned has made all the necessary information and documentation available to the reviewer for his review. However, in any case this on-site review should not extend beyond seven working days.
Initial meeting
1. An initial meeting will be held between the reviewer and a partner/ sole proprietor of the practice unit designated to deal with the review (designated partner). The primary purpose of this meeting is to confirm the accuracy of the responses given in the Questionnaire. The description of the system in the Questionnaire may not fully explain all the relevant procedures and policies adopted by the practice unit and this initial meeting can provide additional information. The reviewer should have a full understanding of the system and be able to form a preliminary evaluation of its adequacy at the conclusion of the meeting.
2. Large practice units which have extensive documentation regarding their practice and procedures (i.e. formal office procedure manuals and audit manuals) will find it unnecessary to document all the controls and will be expected to cross reference the Questionnaire to the relevant sections of their manuals. For practices like these an additional planning visit will be arranged before the on-site review to review the relevant manuals.
Compliance Review-General Controls
1. The reviewer may carry out a compliance review of the General Controls and evaluate the degree of reliance to be placed upon them. The degree of reliance will, ultimately, affect the attestation services engagements to be reviewed.
The following five key controls will be considered as General Controls:
*
Independence
*
Maintenance of Professional Skills and Standards
*
Outside Consultation
*
Staff Supervision and Development
*
Office Administration
'Practice units are expected to address each of the five key control areas'
2. In each key control area there shall be supplementary questions and matters to consider. These are intended to ensure that the kind of controls that are expected to be maintained, are installed and operated within practice units.
3. All questions in the questionnaire may not necessarily be relevant to particular types of practice units because of their size and culture etc. However, practice units should still assess their internal control systems to ascertain whether they address the objectives under the five key control areas.
4. Selection of attestation services engagements to be reviewed
1. The number of attestation services engagements to be reviewed depends upon :
*
The number of practicing members involved in attestation services engagements in the practice unit;
*
The degree of reliance placed, if any, on general quality controls; and
*
The total number of attestation services engagements undertaken by the practice units for the period under review.
2. From the initial sample selected at the planning stage, the reviewer, in consultation with the practice unit, may reduce the initial sample to a smaller actual sample of attestation services engagements for review. The engagements reviewed should be a balanced sample from a variety of different sized clients covering various industries so that they reflect the overall performance of a practice unit. Accordingly, if the reviewer onsiders that the actual sample is not representative of the practice units attestation services client portfolio, he may make further selections from the initial sample or from the complete attestation services client list.
5. Review of records
The reviewer may adopt a compliance approach or substantive approach or a combination of both in the review of attestation services engagement records.
1. Compliance approach-Attestation services Engagements
*
The compliance approach is to assess whether proper control procedures have been established by the practice unit to ensure that attestation services are being performed in accordance with Technical Standards.
The following six key controls shall be considered:
o
Audit Record Administration
o
Financial Statements Presentation
o
Review and Evaluation of System of Internal controls
o
Substantive Tests
o
Audit Conclusion
o
Audit Report
*
Practice units should have procedures and documentation sufficient to cover each of the key control areas. Members in smaller practices may find some of the documentation too elaborate for most of their clients and so should tailor their attestation services documentation to suit their particular circumstances with justification for doing so provided to the reviewer.
2. Substantive approach-Attestation services Engagements
A substantive approach will be employed if the reviewer chooses not to place reliance on the practice unit's specific controls on attestation engagements or is of the opinion that the standard of compliance is not satisfactory. This approach requires a review of the attestation working papers in order to establish whether the attestation work has been carried out as per norms of Technical Standards.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- REGARDING GST ON COMMERICIAL PROPERTY
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- GST on export of services and Input Credit
- TDS U/S. 194NF
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- ITC temporary reversal and reclaim
- Applicable TDS rate for sale of property in Nov 2024
- Donation Receipt u/s 80G
- MIS MATCH OF INVOICE NUMBER
- VERIFICATION OF REFUND RELATED
- GST Regis.
- ITC c/f from FY2022-23 to FY2023-24 entered the same in table 8C of GSTR9 of FY 2022-23, in FY23-24
- Late filling fees Demand by gst office
- IGST Credit-Show cause notice issued-confusion
- Short and Excess provision of expenses
- Issue of gst e invoice
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
Trending Online Classes
CAclubindia
