Statements on Quality Control Standards (SQCS) ...

Statements on Quality Control Standards (SQCS) - the quality control policies and procedures applicable to a firm's accounting and auditing practice. It encompasses: 

• Leadership responsibilities for quality 
• Relevant ethical requirements
• Acceptance and continuance of client relationships 
• Acceptance and continuance of specific engagements
• HR
• Engagement performance
• Monitoring

In relation to quality control, as per QC Section 10.03 , “The firm must establish a system of quality control designed to provide the firm with reasonable assurance that the firm and its personnel comply with professional standards and applicable regulatory and legal requirements, and that the firm or engagement partners issue reports that are appropriate in the circumstances.”

Note that, obtaining an understanding of internal control involves evaluating the design of a control and determining whether it has been implemented. Therefore, it is important to understand per GAAS, properly designed control help in preventing or detecting and correcting material misstatements, whether due to fraud or error.

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