Hello Professionals! We all have heard about ‘Quality Review Board’, and here I will provide a snapshot about the Quality Review Board.
In the current scenario where day by day new provisions, law and regulations are implementing to regularise & strengthen the economy of the country, Government of India is also imposing a watch on ‘Quality of Service’ provided by Members in Practice of ICAI by establishing regulators such as ‘Quality review Board’, ‘ National Financial Reporting Authority’, etc. These regulators work parallel to ICAI and Government. It becomes important for us to understand the significance of such regulators in our practice environment. Lets discuss about Quality Review Board (QRB).
What is Quality review Board?
It is statutory body constituted by Central Government empowered by s. 28A of the Chartered Accountants Act, 1949, consequent to the Chartered Accountants (Amendment) Act, 2006.
Below are the Functions of Quality Review board:
- to recommend Council, the quality of services provided by the members of ICAI;
- to review the quality of services provided by the members including audit services;
- to guide the members of the Institute to improve the quality of services and adherence to the various statutory and other regulatory requirements.
- QRB will conduct review of audits of companies/ body corporates as specified under Rule 3 of the NFRA Rules, 2018; on specific reference made by NFRA and not otherwise
- can call for any report or information in respect of such auditors or companies or bodies corporate as referred in Rule 3 of NFRA Rules, 2018 as it may deem appropriate
As per the latest ‘Report on Quality Review Board’ (2019-20), QRB also issues advisories to Audit firms which are subsequently followed up for compliance.
Scope of Quality Review Board
With the Ministry of Corporate Affairs notification dated 30.01.2019, QRB can timely initiate reviews of quality of audit services provided by members of ICAI in respect of
- private limited companies,
- unlisted public companies below the thresholds specified under Rule 3(1) of NFRA Rules, 2018
- other entities not specified under Rule 3(1) of NFRA Rules, 2018;
- those referred to QRB by NFRA under Rule 9(4) of NFRA Rules, 2018.
With this, Quality Review Board also becomes an overseeing Authority for NFRA i.e NFRA lies below Quality review board in the hierarchy of monitoring regulators.
It is worthwhile to note that ‘disciplinary action can be taken against a member directly to Disciplinary Directorate on recommendations of QRB, before being placed to the Council of ICAI’.
Key Takeaways
Precisely, it can be said that Quality Review Board reviews whether the audits conducted by member of the Institute is in accordance and in compliance with Accounting standards, Standards of auditing, Code of ethics, Companies act, Income tax , etc (applicable laws and regulations). QRb publishes periodic reports, providing key findings, deficiencies that may occur and can eliminated within time, etc. It helps the member to understand the area of improvement and identification of root cause of deficiencies. Below is the link of QRB report for 2019-20 for members reference.
Source- http://www.qrbca.in/wp-content/uploads/2020/12/report-aqr19-20.pdf
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Disclaimer: The above article is based on information available & my understanding. There can be other opinion as well.
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