Munir & Co. is a practicing-chartered accountants' firm having its Head Office at Mumbai. Mr. A, a dedicated and capable article assistant…

Review of Audited Financial Statements: As per SQC 1, "Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements”, Engagement quality control reviewer is a partner, other person in the firm (who should be member of ICAI), suitably qualified external person, or a team made up of such individuals. In this regard, suitably qualified external person refers to an individual outside the firm with the capabilities and competence to act as an engagement partner, for example a partner or an employee (with appropriate experience) of another firm. In addition, the engagement quality control reviewer for an audit of the financial statements of a listed entity is an individual with sufficient and appropriate experience and authority to act as an audit engagement partner on audits of financial statements of listed entities. In the given case, Munir & Co, admitted Mr. A, who was an articled assistant for 3 years, as a Partner on 1st February 2025 after he qualified as a Chartered Accountant. He was appointed as Engagement Quality Control Reviewer (EQCR) for J & J Limited, a listed company, for FY 2024-25. It may be considered that CA A has recently qualified as a Chartered Accountant and does not possess the competence and capability for the work assigned. Therefore, it was not appropriate for CA A to accept the assignment of Engagement and Quality Control Reviewer. Further, the engagement quality control reviewer shall document, for the audit engagement reviewed, that: (i) The procedures required by the firm's policies on engagement quality control review have been performed. (ii) The engagement quality control review has been completed on or before the date of the auditor's report. (iii) The reviewer is not aware of any unresolved matters that would cause the reviewer to believe that the significant judgments the engagement team made and the conclusions they reached were not appropriate. In the given situation, there are no working papers to show that Engagement quality control reviewer has done an evaluation of conclusion reached by the engagement team. Mere signing on some working papers of the engagement team shows that Engagement and Quality Control Reviewer has made no such evaluation and review of work performed by the engagement team. In view of above, act of CA A only signing a few working papers is not correct, and he shall maintain documentation in accordance with the Engagement and Quality Control Standards. Alternative Solution As per SA 220, “Quality Control for an audit of financial statements", the engagement quality control reviewer shall perform an objective evaluation of the significant judgments made by the engagement team, and the conclusions reached in formulating the auditor's report. This evaluation shall involve: (i) Discussion of significant matters with the engagement partner. (ii) Review of the financial statements and the proposed auditor's report. (iii) Review of selected audit documentation relating to the significant judgments the engagement team made and the conclusions it reached and (iv) Evaluation of the conclusions reached in formulating the auditor's report and consideration of whether the proposed auditor's report is appropriate. For audits of financial statements of listed entities, the engagement quality control reviewer, on performing an engagement quality control review, shall also consider whether audit documentation selected for review reflects the work performed in relation to the significant judgments made and supports the conclusions reached. Further, the engagement quality control reviewer shall document, for the audit engagement reviewed, that: (i) The procedures required by the firm's policies on engagement quality control review have been performed. (ii) The engagement quality control review has been completed on or before the date of the auditor's report. (iii) The reviewer is not aware of any unresolved matters that would cause the reviewer to believe that the significant judgments the engagement team made and the conclusions they reached were not appropriate. In the given situation, there are no working papers to show that Engagement quality control reviewer has done an evaluation of conclusion reached by the engagement team. Mere signing on some working papers of the engagement team shows that Engagement and Quality Control Reviewer has made no such evaluation and review of work performed by the engagement team. In view of above, act of CA A only signing a few working papers is not correct, and he shall maintain documentation in accordance with SA 220.