This is a test version of our website! Please navigate to our main site here www.mercia-group.com
New standards for Quality Management in Auditing and Reviews of Financial Statements are coming.
In September 2020, two new International Standards on Quality Management, ISQM 1 and ISQM 2, together with a revised version of International Standard on Auditing 220 were approved. These will replace the current quality control standard (ISQC1) and the existing version of ISA 220. The new ISQMs are designed to create a more robust, proactive and effective system for quality management.
On this page:
Following a series of high-profile audit failures, the International Auditing and Assurance Standards Board’s (IAASB) has updated the Quality Management standards.
The International Standards of Quality Management (ISQMs) are designed to fix inefficiencies in the current standards. More focus is placed on proactive responses to quality management issues. The impact of ISQMs mean that professional accountancy firms will need to change the way they handle quality management. In particular when it comes to audits, reviews, and other assurance and related services engagements.
ISQM stands for International Standard on Quality Management (ISQM). There are two ISQMs:
These are supplemented by ISA 220 (Revised) - specifically for auditing firms, which handles the specific responsibilities of the auditor on an audit engagement.
The standards place greater responsibility on a firm’s leadership for continuously improving the quality of their engagements and taking remedial action when deficiencies are found. The standards should help ensure that a commitment to quality is at the heart of a firm’s strategy and operations.
The ISQMs were officially approved in September 2020 with the standards released in December 2020.
The three new standards will come into effect from the 15th December 2022.
Days until ISQM come into effect:
To help your audit firm prepare for ISQMs, Mercia has created an extensive Risk Assessment Tool. This tool highlights over 100 different potential Quality Management risks and responses for them.
Designed to suit any size firm, the Mercia Risk Assessment Tool makes preparing for ISQM easy.
Need help getting started with ISQMs?
In order to help your firm be ready for ISQMs, Mercia has put together an extensive Risk Assessment Tool for Quality Management.
Access to over 100 potential risks all comprehensively catalogued. All risks are rated and include example risk mitigation procedures which your firm can put in to place.
Use the Risk Assessment Tool to get your firm ready in time for ISQM.
Available in Spring 2022
 |
100+ Risks Catalogued |
Over 100 potential quality risks which your firm could face. Each with recommended actions to reduce the risk which you can adapt for your firm. |
|
Easy-to-use |
Choose between Excel Spreadsheet or PDF version. Risks are broken down into simple topic areas for ease of use. |
|
Suitable For All Firms |
The Assessment Tool identifies key risks regardless of whether you are a sole-practitioner or a large firm. |
Our Auditing Experts answer key questions regarding the new ISQMs.
ISQM 1 replaces ISQC 1. Meanwhile, ISQM 2 is a brand new standard; but many elements have been relocated from other standards such as ISQC1 and ISA 220.
ISA 220 (Revised) is an updated version of the existing ISA 220 standards.
Firms are advised to start preparing for ISQM as soon as possible.
Mercia have created a comprehensive Risk Assessment Tool to help you design effective policies that meet the new ISQM standards.
The Risk Assessment Tool includes over 600 possible quality management risks and effective methods to reduce any risks.
Mercia also has a range of training courses to help prepare for ISQM implementation.
We are busy building our portfolio of related training
Includes a useful summary of ISQM (UK)1 and ISQM 2
Each quarter will include a different aspect of the ISQMs
Risk Assessment under ISQM 1 including practical examples
Monitoring and remediation of the System of Quality Management (SOQM) including practical examples
ISQM 2 including how it links to the requirements of ISQM 1
Web articles on the forthcoming changes are available below:
Get Advice and Support for getting your firm ready for ISQM
