ICAI issued Guidance on Non-Compliances Observed by Quality Review Board during Quality Reviews

The Institute of Chartered Accountants of India (ICAI) has issued Guidance on Non-Compliances Observed by Quality Review Board during Quality Reviews (Volume 3).

Review of the quality of audit services performed by audit firms is an important mechanism to improve audit quality.

The Quality Review Board (QRB) was constituted in June 2007 under the provisions of the Chartered Accountants Act, 1949. QRB conducts quality reviews of audit services of audit firms which are covered under its domain.

These quality reviews bring out instances of various non-compliances of Standards on Quality Control (SQC), Standards on Auditing (SAs), audit reports, Companies (Auditor’s Report) Order (CARO), Accounting Standards (AS), Indian Accounting Standards (Ind AS), Schedule VI of Companies Act, 1956/ Schedule III of Companies Act, 2013 etc.

QRB gives advisories to audit firms based on observations made during these quality reviews. On the matter, QRB requested the Council of ICAI to bring out necessary guidance for the members of ICAI based on common non-compliances observed. Note that the Auditing and Assurance Standards Board (‘Board’ or ‘AASB’) has undertaken the project and earlier, in May 2024 released Volume 1 of “Guidance on Non-Compliances Observed by Quality Review Board During Quality Reviews” and in July 2024, Volume 2 of “Guidance on Non-Compliances Observed by Quality Review Board During Quality Reviews”.

Now, it is heartening to learn that the Board is bringing out Volume 3 of “Guidance on Non-Compliances Observed by Quality Review Board During Quality Reviews”.

The AASB decided to engage several specialists to prepare suggested recommendations for members on the subject. The AASB also decided to form a consolidation group to assess the recommendations produced by these experts. AASB also chose to release the guidance in different volumes due to the large size of the task.

This publication is a compilation of 46 common non-compliances observed by QRB while conducting quality reviews and covering 151 cases (including NIL cases) received from QRB.

The publication also includes AASB’s guidelines for members on these typical non-compliances. The goal of this publication is to raise awareness among members about common non-compliances noticed by QRB and to assist them in completing quality audits.

For Official Guidance Download PDF Given Below: