An internal evaluation of the significant judgments made by the audit team and the conclusions reached in formulating its report for engagements meeting specified criteria is known as a(n):
A)engagement quality control review.
B)inspection.
C)peer review.
D)performance control evaluation.

Question

Quizplus · Accepted Answer

An engagement quality control review (EQCR) is an internal evaluation of the significant judgments made by the audit team and the conclusions reached in formulating its report for engagements meeting specified criteria. The purpose of the EQCR is to provide assurance that the engagement complies with professional standards and the firm's quality control policies and procedures. Option B, inspection, refers to an external evaluation of the firm's quality control system. Option C, peer review, is an external evaluation of a firm's accounting and auditing practice by other CPA firms. Option D, performance control evaluation, is not a commonly used term in the accounting profession.

An Internal Evaluation of the Significant Judgments Made by the Audit