The Institute of Chartered Accountants of India (ICAI) has announced an expansion of its mandatory Audit Quality Maturity Model (AQMM), version 2.0. Previously applicable to firms auditing listed entities, banks (excluding co-operative banks), and insurance companies, the new policy extends this requirement to a wider range of audit firms in a phased approach. Beginning April 1, 2026, AQMM will become mandatory for firms auditing the holding, subsidiary, associate, or joint venture companies of listed entities, banks, and insurance companies. This new requirement excludes firms that only conduct branch audits. Additionally, from April 1, 2026, firms proposing to audit unlisted public companies that meet certain size criteria (paid-up capital of ₹500 crore, turnover of ₹1,000 crore, or outstanding loans of ₹500 crore) will also be subject to AQMM. A further phase will begin on April 1, 2027, making AQMM mandatory for firms auditing entities that have raised public, bank, or financial institution funds over ₹50 crore, as well as other public interest entities. The ICAI also decided to publicly disclose the AQMM level of reviewed firms on its website and on their Peer Review Certificates.
Institute of Chartered Accountants of India
Centre for Audit Quality
The Institute of Chartered Accountants of India
11th August 2025
ANNOUNCEMENT
Widening the scope of mandatory applicability of Audit Quality Maturity Model (AQMM) and disclosure of AQMM Levels on ICAI Website and Peer Review Certificates
At present the Audit Quality Maturity Model is mandatory for Firms auditing the following entities excluding the Firms conducting only branch audit:
a. A Listed Entity
b. Banks other than Co-Operative banks (Except multi- state Co-operative banks)
c. Insurance Companies
The scope of mandatory applicability of AQMM version 2.0 has now been widened and accordingly AQMM v. 2.0 has been made mandatory in a phased manner for the following categories of firms:
| S. No. | Category of Firms | Date of applicability (Peer Review conducted on or after) |
| 1. | Firms auditing the Holding/Subsidiary/ Associates/Joint Ventures of the following entities: a) A Listed Entity b) Banks other than Co-operative banks c) Insurance Companies However, the firms conducting only branch audits are not to be covered. |
April 1, 2026 |
| 2. | Firms (referred to as ‘Practice Units’ in Peer Review Guidelines 2022’) which propose to undertake Statutory Audit of unlisted public companies having paid-up capital of not less than rupees five hundred crores or having annual turnover of not less than rupees one thousand crores or having, in aggregate, outstanding loans, debentures and deposits of not less than rupees five hundred crores as on the 31st March of immediately preceding financial year. |
April 1, 2026 |
| 3. | Firms (referred to as ‘Practice Units’ in Peer Review Guidelines 2022’) which propose to undertake the Statutory Audit of entities which have raised funds from public or banks or financial institutions of over Fifty Crores rupees during the period under review or of any body corporate including trusts which are covered under public interest entities. | April 1, 2027 |
Disclosure of AQMM Levels on ICAI Website and Peer Review Certificates:
The level of the Firm assessed under AQMM is currently being hosted by the Peer Review Board on the ICAI website, alongside the date of validity of the Peer Review Certificate. It has now been decided that the list of AQMM v. 2.0 reviewed Firms will be hosted level-wise on the ICAI website by the Peer Review Board, and the AQMM v. 2.0 level of the Firm will also be mentioned on the Peer Review Certificate issued to the Firms.
