Under the Financial Reporting Council Ordinance, the FRC has the power to direct an inspector to carry out an inspection in relation to the PIE engagements completed by a PIE auditor on or after 1 October 2019 for the purpose of ascertaining whether the PIE auditor has complied with, or is likely to be able to comply with: (i) a provision of the FRCO; or (ii) a professional standard.
The Department of Inspection is responsible for carrying out inspections with the objectives of monitoring and promoting audit quality. An inspection focuses on how a PIE auditor conducted PIE engagements and on the effectiveness of the PIE auditor’s quality control system to determine whether the applicable professional standards and legal and regulatory requirements have been complied with.
All PIE auditors that undertake PIE engagements are subject to inspections. The frequency of inspections varies with larger firms inspected annually while other firms are generally inspected once every three years.
Further details of the inspection function are set out in the
Inspection Policy Statement.
If you have any questions relating to inspection, please refer to
Frequently Asked Questions or contact us by:
Tel: +852 2810 6321
Fax: +852 2810 6320