In September 2020, the International Auditing and Assurance Standards Board (IAASB) issued a new set of Quality Management Standards which includes ISQM 1, ISQM 2 and the ISA 220 (Revised). The International standard of Quality Management (ISQM) 1 applies to all firms performing audits or reviews of financial statements or other Assurance or related services engagements. This implies that the non-audit functions and services like Advisory, Consulting, Risk management, Compliance, and other assurance engagements will also come under the umbrella of quality management. This presents an opportunity for firms to revisit their quality management systems with the goal of identifying their quality objectives, assessing the quality risks and designing and implementing responses that best address those risks.

Firms are mandated to establish and execute quality management systems aligned with ISQM 1 by the deadline of 15 December 2022. This requirement signifies a comprehensive organizational assessment and a fundamental shift in the corporate culture. ASICO is poised to comply with this imperative and has developed its own engagement quality standard policies and guidelines currently rolling firmwide. The firm acknowledges the inherent risks associated with audit engagements and pledges to equip its personnel in the Audit, Assurance, and Advisory divisions with comprehensive training on the significance and advantages of quality management for both internal stakeholders and clients. Emphasis will be placed on the annual evaluation of the ISQMs and the execution of requisite measures to mitigate quality risks and attain quality management objectives. It is essential that our quality management system incorporates continual monitoring to capture insights relating to your quality management. Moreover, it is imperative to visually depict the interrelations between risks and corresponding responses and significant insights for deliberation.

The crucial steps necessary to enhance quality include the review and discussion of the new standard, identification of current key risks, redefinition of quality management priorities, and ensuring the adaptability and scalability of the system for future changes. It is imperative for organizations to thoroughly document compliance at each stage of the process, emphasizing active ownership of the quality program. Subsequently, rigorous testing, identification of deficiencies, assessment, and rectification are essential. We firmly believe in an all-encompassing approach to quality management and intend to engage all our staff members in embracing, adjusting, and operating within the framework of the new ISQM. This marks the commencement of an extensive journey towards quality enhancement and overall excellence in our endeavors, which will significantly benefit our clients, stakeholders, and the broader society.