After fieldwork audit procedures are completed for a public company and private company whose financial statements are expected to be widely distributed, a partner of the CPA firm who has not been involved in the audit performs an engagement quality review of the working papers. This review focuses on:
A)an evaluation of the significant judgments made by the engagement teams and the conclusions reached in formulating the audit report.
B)irregularities involving the entity's management and its employees.
C)the materiality of the adjusting entries proposed by the audit staff.
D)the communication of internal control weaknesses to those charged with governance.

Question

Quizplus · Accepted Answer

The engagement quality review is focused on evaluating significant judgments made by the engagement teams and the conclusions reached in formulating the audit report. This ensures that the audit followed professional standards and that the resulting report is appropriate and accurate. The other options, such as irregularities involving management, materiality of adjusting entries, or communication of control weaknesses, may be addressed during the fieldwork audit procedures or in other stages of the audit process.

After Fieldwork Audit Procedures Are Completed for a Public Company