17 participants from the REPARIS countries together with experts from the UK and France attended the workshop, which was moderated by Ranjan Ganguli and Andrei Busuioc from the CFRR.
Branka Petričević, Dušanka Jelcić and Tihana Mavrić from the Quality Assurance Deaprtment of the Croatian Audit Chamber (CAC, which was admitted as an associate member of IFAC in 2010) described how quality assurance is carried out in Croatia. They first outlined the regulatory background, including the national law on auditing (which met the requirements of the EU’s Statutory Audit Directive), national professional rules and audit standards and then went on to describe the various stages of evaluation under the QAS in Croatia.
They stressed that the QAS in Croatia was still in its early stages (the QAS only became operational in January 2010) and that evaluations were currently intended to be educational, helping the auditor or audit firm to improve their performance rather than seeking to punish firms if poor performance was identified. The first phase of the Croatian QAS involved sending a questionnaire to all audit firms to collect basic information on their activities. This was followed by an assessment visit to each firm by the reviewers from the CAC. The CAC reviewer would use this visit to check the basic information and to check how far the firm was complying with the overall rules governing audits. This was supplemented by analysis of audit reports that the firm had prepared. The CAC reviewer then brought together all this information to grade each audit firm on its performance and to prepare a report to the firm. The Croatian team explained many of the practical issues that arose in planning and carrying out these reviews and circulated examples of the various questionnaires, reports and other documents that CAC reviewers used.
Branka Stojanovska from the Quality Assurance Committee of the Institute of Certified Auditors of Macedonia (ICAM, which had been operating since 2006) then described how the QAS functioned in Macedonia, giving a detailed description of how inspections were organized and interviews were conducted. Ms Stojanovska also provided examples of the main documents used in the audit review process. She said that the Macedonian system, which had been set up with assistance from the French Institute of Certified Auditors, shared many elements with the QAS used in Croatia. In particular, ICAM was also currently using QA reviews primarily as educational tools to improve the performance of audit firms.
However, there were some significant differences. In particular, the Macedonian QAS involved two visits to audit firms, with the first covering internal procedures at the audit firm, and the second reviewing individual engagements that the audit firm had carried out. Ms Stojanovska also placed particular stress on the confidentiality of the information obtained from the review of an audit firm – the ICAM was obliged to destroy all documentation from the previous quality control review once a new review was being carried out, and was also not allowed to keep working papers that the auditor had prepared in the documentation of the review.
Paul Simkins from the UK's ICAEW, which had assisted Croatia in designing its QAS, and Marc Konczaty, from France's Conseil Supérieur de l'Ordre des Experts-Comptables (CSOEC) commented on both presentations.
In addition to the formal presentations, workshop participants took on the roles of reviewer and auditor to stage enactments of review visits and interviews under both the Croatian and Macedonian QAS. The workshop concluded with a round table discussion giving participants the opportunity to express their views on the conduct of the workshop.
Participants gained a much clearer idea of how a QAS operates in practice in two countries of the region and these insights will help them design and then implement a QAS for their own countries. Participants were particularly happy with the enactment sessions.
A large amount of video material, covering the presentations, discussions and the meeting enactments was collected. The CFRR is currently editing this to produce a DVD of educational material which AOCoP members can then distribute to those who will be involved in setting up or designing QAS's in each REPARIS country.