Quality control standards continue to generate questions and confusion regarding monitoring and the peer review process, despite the fact that Statement of Quality Control Standard No. 3, Monitoring a CPA Firm’s Accounting and Auditing Practice, went into effect ten years ago. The following Q&A speaks to some of the frequent inquiries addressed by the MACPA Peer Review Task Force. Additional questions on monitoring will be addressed in the next several issues of Leaders’ Edge.

Q –Who is required to follow Quality Control Standards? Since our firm doesn’t do any audits, we don’t have to worry about this, right?

A – The Auditing Standards Board of the AICPA issued Statements on Quality Control Standards. Any firm enrolled in an approved peer review program is obligated to adhere to quality control standards established by the Institute. Quality control standards apply to a firm’s accounting and auditing practice; meaning all audit, attest, accounting and review, and other services for which standards have been established by the AICPA Auditing Standards Board or the AICPA Accounting and Review Services Committee.

Q – What do the quality control standards require?

A – Every firm, regardless of size, must have a system of quality control for its accounting and auditing practice. The required elements of this quality control system are independence, integrity and objectivity; personnel management; acceptance and continuance of clients and engagements; engagement performance; and monitoring.

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