(Ref: Para. A1–A1-1)15. The requirements are designed to enable the firm to achieve the objective stated in this ISQC (UK). The proper application of the requirements is therefore expected to provide a sufficient basis for the achievement of the objective. However, because circumstances vary widely and all such circumstances cannot be anticipated, the firm shall consider whether there are particular matters or circumstances that require the firm to establish policies and procedures in addition to those required by this ISQC (UK) to meet the stated objective. 15D-1. The firm shall: (a) Take into consideration the scale and complexity of the firm’s activities when complying with the requirements set out in paragraphs16D-1, 16D-2, 20D-1, 21D-1, 29D-1, 29D-2, 32D-1 and 48D-1 of this ISQC (UK); and(b) Be able to demonstrate to the competent authority3dthat the firm’s policies and procedures designed to achieve compliance with the applicable requirements of this ISQC (UK) are appropriate given the scale and complexity of the firm’s activities. Elements of a System of Quality Control 16. The firm shall establish and maintain a system of quality control that includes policies and procedures that address each of the following elements: (a) Leadership responsibilities for quality within the firm. (b) Relevant ethical requirements. (c) Acceptance and continuance of client relationships and specific engagements. (d) Human resources. (e) Engagement performance. (f) Monitoring. 16D-1. The firm shall establish appropriate policies and procedures to ensure that no partner, director, member or shareholder of the firm, or partner, director, member or shareholder any affiliate of thefirm, intervenes in the carrying out of an engagement in any way which jeopardizes the firm’s independence and objectivity in carrying out such work. 16D-2. The firm shall have: (a) Sound administrative and accounting procedures; (b) Internal quality control mechanisms which are designed to secure compliance with decisions and procedures at all levels of the firm’s working structure; (c) Effective procedures for risk assessment; and (d) Effective control and safeguard arrangements for information processing systems. 3dIn the UK, the competent authority designated by law is the Financial Reporting Council or the Recognised Supervisory Body to whom the FRC has delegated regulatory tasks, as applicable.
ISQC (UK) 1 – Revised June 2016 917. The firm shall document its policies and procedures and communicate them to the firm’s personnel. (Ref: Para. A2–A3) Leadership Responsibilities for Quality within the Firm 18. The firm shall establish policies and procedures designed to promote an internal culture recognizing that quality is essential in performing engagements. Such policies and procedures shall require the firm’s chief executive officer (or equivalent) or, if appropriate, the firm’s managing board of partners (or equivalent) to assume ultimate responsibility for the firm’s system of quality control.