For purposes of the ISAs, the following terms have the meanings attributed below:
Engagement partner: The partner or other person in the firm who is responsible for the audit engagement and its performance, and for the auditor’s report that is issued on behalf of the firm, and who (where required) has the appropriate authority from a professional, legal or regulatory body.
Engagement quality control review: A process designed to provide an objective evaluation, on or before the date of the auditor’s report, of the significant judgments the engagement team made and the conclusions it reached in formulating the auditor’s report. The engagement quality control review process is for audits of financial statements of listed entities and those other audit engagements, if any, for which the firm has determined an engagement quality control review is required.
Engagement quality control reviewer: A partner, other person in the firm, suitably qualified external person, or a team made up of such individuals, none of whom is part of the engagement team, with sufficient and appropriate experience and authority to objectively evaluate the significant judgments the engagement team made and the conclusions it reached in formulating the auditor’s report.
Engagement team: All partners and staff performing the engagement, and any individuals engaged by the firm or a network firm who perform audit procedures on the engagement. This excludes an auditor’s external expert engaged by the firm or a network firm.
Firm: A sole practitioner, partnership or corporation or other entity of professional accountants.
Inspection: In relation to completed audit engagements, procedures designed to provide evidence of compliance by engagement teams with the firm’s quality control policies and procedures.
Listed entity: An entity whose shares, stock or debt are quoted or listed on a recognized stock exchange, or are marketed under the regulations of a recognized stock exchange or other equivalent body.
Monitoring: A process comprising an ongoing consideration and evaluation of the firm’s system of quality control including a periodic inspection of a selection of completed engagements, designed to provide the firm with reasonable assurance that its system of quality control is operating effectively.
Network firm: A firm or entity that belongs to a network.
Network: A larger structure:
i. That is aimed at cooperation, and
ii. That is clearly aimed at profit or cost-sharing or shares common ownership, control or management, common quality control policies and procedures, common business strategy, the use of a common brand name, or a significant part of professional resources.
Partner: Any individual with authority to bind the firm with respect to the performance of a professional services engagement.
Personnel: Partners and staff.
Professional standards – International Standards on Auditing (ISAs) and relevant ethical requirements.
Relevant ethical requirements: Ethical requirements to which the engagement team and engagement quality control reviewer are subject, which ordinarily comprise Parts A and B of the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) related to an audit of financial statements together with national requirements that are more restrictive.
Staff: Professionals, other than partners, including any experts the firm employs.
Suitably qualified external person: An individual outside the firm with the competence and capabilities to act as an engagement partner, for example, a partner of another firm, or an employee (with appropriate experience) of either a professional accountancy body whose members may perform audits of historical financial information or of an organization that provides relevant quality control services.