New Standards of Quality Management in Audit. The Risk-Based Approach

Keywords: auditing, quality, quality management, audit engagement, quality control of audit performance, auditing firm.


The article proves that auditing is a socially significant activity. Therefore, the auditor must ensure the validity of his opinion, which is achieved through ensuring the quality of audit procedures at all stages. Failure to ensure the quality of audit tasks is a reason to mislead users of financial statements of enterprises and auditorsʼ conclusions, does not warn users about financial problems and the possibility of bankruptcy, especially in socially significant companies. From December 2022 on the audit, quality control of audit services are waiting for radical changes in quality management. The article highlights the results of a study devoted to new requirements to quality management in auditing firms, resulting from the enforcement of the new standards: ISQM 1 “Quality Management”, ISQM 2 “Engagement Quality Reviews”, and the revised ISA 220 “Quality Management for an Audit of Financial Statements”. The design of a quality management system at firm level is considered in ISQM 1, including building up an organization system for management of audit quality, creating the essential conditions for performing audits. This standard will be enforced in place of the existing ISQC 1“Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements”. The new quality management system includes the following components: the risk assessment process of the audit firm; management and leadership, ethical requirements, acceptance, continuation of customer relationships and specific tasks; resource; performance of tasks; information and communication; monitoring and sanctions. ISQM 2 “Engagement Quality Reviews” specifies the requirements to reviewers of the quality of performed audit engagements. A quality reviewer is required to have knowledge and understanding of professional standards, current legal and normative acts, and understanding of firm’s policies or procedures used in the process of engagement performance; knowledge of the industry of a company to which audit services on engagement performance were provided; the professional experience in evaluations of scopes and complexity of the performed engagements, the professional qualification for quality evaluations of the engagement performance, including the firm’s obligation for providing this qualification. The abovementioned requirements cause the need in additional studies aimed at elaborating new schemes for actions and inclusion of engagements in job descriptions of quality reviewers.


Download data is not yet available.


1. Asare, S. K., Van Buuren, J. P., & Majoor, B. (2019). The joint role of accountants’ and auditees’ incentives and disincentives in the resolution of detected misstatements. Auditing: A Journal of Practice & Theory, 38 (1), 29–50. Retrieved from
2. Bondar, V. P, & Bondar, Yu. V. (2015). Yakist v audyti ta deiaki aspekty upravlinnia yakistiu [Quality in audit and some aspects of quality management]. Problemy teorii ta metodolohii bukhhalterskoho obliku, kontroliu i analizu – Problems of Theory and Methodology of Accounting, Control and Analysis, 1 (31), 36–65. Retrieved from [in Ukrainian].
3. DeFond, M., & Zhang, J. (2014). A review of archival auditing research. Journal of Accounting and Economics, 58 (2–3), 275–326. Retrieved from
4. Dmytrenko, I. M. (2001). Kontrol yakosti audytu: vid standartiv do praktyky [Audit quality control: from standards to practice]. Proceeding from Theory and practice of audit in Ukraine: Vseukrainska naukovo-praktychna konferentsiia – All-Ukrainian scientific-practical conference. (pp. 132–135). Kyiv [in Ukrainian].
5. International Standards for Quality Control, Audit, Review, Other Assurance and Related Services Pronouncements. (2016–2017). International Auditing and Assurance Standards Board (IAASB). Retrieved from [in Ukrainian].
6. International Standard on Quality Management 1 (ISQM 1). (2020). International Auditing and Assurance Standards Board (IAASB). Retrieved from
7. International Standard on Quality Management 2 (ISQM2). (2020). International Auditing and Assurance Standards Board (IAASB). Retrieved from
8. International Code of Ethics for Professional Accountants. (2018). International Federation of Accountants (IFAC). Retrieved from
9. Limani, A., & Meta, A. (n.d). What is a high quality audit? Retrieved September 30, 2021 from [in Ukrainian].
10. Naibilshyi finansovyi proval v istorii [The biggest financial failure in the history]. (2002). Yurydychna praktyka, 10 (220), March 6. Retrieved from [in Russian].
11. Redko, O. (2009). Yakist audytorskykh posluh: filosofiia ta mifolohiia [Quality of auditing services: philosophy and mythology]. Bukhhalterskyi oblik i audyt – Accounting and Auditing, 1, 46–54 [in Ukrainian].
12. Naistarisha v sviti turystychna kompaniia “ne vytrymala XXI stolittia” [The world’ oldest company failed “to stand the 21st century”]. (2019). UKRINFORM. September 27. Retrieved from [in Ukrainian].
13. Vasyliuk, М. М. (2019). Kontseptualna osnova yakosti audytu [A conceptual framework of audit quality]. Ivano-Frankivsk: Publishing House of Vasyl Stefanyk Precarpathian National University [in Ukrainian].
14. Pro audyt finansovoi zvitnosti ta audytorsku diіalnist: Zakon Ukrainy vid 21.12.2017 r. № 2258-VIII, stanom na 01.08.2021 r. [On Financial Audit reporting and auditing activities. Law of Ukraine of December 21, 2017 No 2258-VIII as of August 01, 2021]. Retrieved from [in Ukrainian].

Abstract views: 26
PDF Downloads: 20
How to Cite
Lubenchenko, O. E., Shulha, S. V., & Korinko, M. D. (2022). New Standards of Quality Management in Audit. The Risk-Based Approach. Statistics of Ukraine, 96(1), 117-126. Retrieved from