A peer review in which the peer reviewers study and appraise a CPA firm's system of quality control to perform accounting and auditing work is referred to as a(n):
A)Engagement review.
B)Inspection review.
C)Supervision review.
D)System review.

Question

Quizplus · Accepted Answer

A system review is specifically designed to assess a CPA firm's system of quality control to ensure compliance with the professional standards for accounting and auditing. The other options listed are different types of peer reviews, but not focused on the evaluation of the firm's quality control system. An engagement review evaluates the specific engagements for compliance with professional standards. An inspection review assesses compliance with the Sarbanes-Oxley Act and PCAOB standards. A supervision review assesses the adequacy of supervision by an AICPA supervisory entity of the reviewed firm's engagements.

A Peer Review in Which the Peer Reviewers Study and Appraise