Lesson: Engagement Quality Review

In this lesson, Nick Palazzolo, CPA, discusses the concept of engagement quality review, which occurs after the completion of an audit. He emphasizes the importance of having a partner who has not been involved in the audit reviewing audit documentation, in order to maintain as much independence as possible. The lesson explains that the purpose of this review is to evaluate the significant judgments made by the audit team and their conclusions. It further covers situations in which the audit firm determines that a quality control review is required, as well as the necessary documentation for an engagement quality review. Finally, the lesson explains the main objective of a quality review, which is to determine whether the audit organization's internal quality control system is in place, operating effectively, and if the policies and procedures are being followed.