A firm of independent auditors must establish and follow explicit quality control policies and procedures because these standards:
A)are necessary to meet increasing requirements of auditors' liability insurers.
B)give reasonable assurance that the firm as a whole will conform to the auditing standards.
C)include formal filing of records of such policies and procedures.
D)are required by the Australian Securities and Investments Commission for auditors of all entities.

Question

Quizplus · Accepted Answer

Quality control policies and procedures are necessary to ensure that the entire firm conforms to auditing standards and provide reasonable assurance to clients and stakeholders that the audit is performed with the highest level of quality. While liability insurers may require certain policies and procedures, they are not the primary reason for establishing and following them. Formal filing of records is not necessarily a requirement, but rather documenting and periodically reviewing the policies and procedures is necessary. The Australian Securities and Investments Commission may require specific policies and procedures for audits of certain entities, but this is not a universal requirement.

A Firm of Independent Auditors Must Establish and Follow Explicit