Reminder to Practitioners and Audit Firms – New Quality Management Standards (ISQMs) – ISA 220 (Revised), ISQM 1 & ISQM 2 will be effective from 15 December 2022

The Practice Review Department (PRD) wishes to remind practitioners and audit firms in Malaysia that the International Auditing and Assurance Standards Board (IAASB) has approved three (3) new quality management standards, which will be effective from 15 December 2022.

Practice Review’s Key Findings on Acceptance and Continuance of Client Relationships and Specific Engagements

The following are some of the key findings from practice review related to the audit firm’s implementation of one of the elements of quality control (ISQC 1), which is “client acceptance and continuance relationships”.

Plugging the Gaps in the Audit of Biological Assets

Auditors are expected to exercise a high degree of vigilance when conducting the audit of biological assets, an area where subjectivity, judgements and estimates abound.

Guidelines on Requesting Extension for Practice Review Deadlines

In the process of practice review, the Practice Review Department (PRD) has encountered many instances where the audit firm (AF) selected for review tends to defer the submission of documents to the PRD without first obtaining approval from the PRD.

Continuous Quality Monitoring for Type 3 Audit Firms

Monitoring review on the implementation of the remedial action plan (RAP) and its ensuing requirements (as prescribed in the MIA By-Laws) will be imposed on the audit firm three months after the approval of the RAP by the Practice Review Committee.

Root Cause Analysis (RCA) – An Essential Process to Improve Audit Quality?

Audit practitioners must identify the root causes impairing audit quality to ensure the success of their Remedial Action Plan (RAP) under the new Practice Review Framework.

Formulating an Effective Remedial Action Plan

MIA’s Remedial Action Plan applicable for audit firms with Type 3 rating aims to tackle continuing weaknesses in audit firms’ performance, in order to heighten audit quality and improve public trust.