The Institute of Chartered Accountants of India (ICAI) has issued an explanatory memorandum on the applicability of Audit Quality Maturity Model where the Institute has clarified that the same is not applicable to CA Firms doing branch audits only.
The Audit Quality Maturity Model -Version 1.0 (AQMM v1.0) is a capacity building measure initiated by ICAI and the objective of this Evaluation Matrix is for sole proprietors and Audit firms to be able to self-evaluate their current level of Audit Maturity, identify areas where competencies are good or lacking and then develop a road map for upgrading to a higher level of maturity.
A statement issued by the Institute on Wednesday stated that the Council meeting held on January 9, 2021 decided that the both the Peer Review Board and the Centre for Audit Quality (CAQ) would need to develop the ecosystem which is acceptable to both and such collaborative approach would have the advantage of the CAQ developing the quality standards and Peer Review Board testing the said standards.
“Using the above-mentioned collaborative approach, the AQMM v1.0 would be recommendatory initially and after 1 year the Council will review the date from which it would become mandatory,” the Institute said.
as per the statement, the Firms auditing a listed company, banks other than co-operative banks (except multi-state co-operative banks) and Insurance Companies are covered in AQMM v1.0.
“However, firms doing only branch audits are not covered,” it said.
it was further stated that the AQMM v1.0 is being shared with various stakeholders as an Exposure Draft and will be available for public comments for a period of 15 days. The Centre for Audit Quality (CAQ) will release the final AQMM v1.0 on July 1, 2021, after incorporating the comments received from stakeholders.
“The CAQ encourages you to fill up the checklist and self-assess your audit quality maturity level. We recommend that your firm try to enhance its competencies every quarter as there is always scope for improvement. We wish you all the best in your journey!,” it said.
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