PCAOB quizzes auditors on new quality control standard

The Public Company Accounting Oversight Board has posted a series of online "knowledge checks" to help auditors gauge their understanding of various aspects of the PCAOB's new quality control standard.

Some of the topics in the knowledge checks include risk assessment, roles and responsibilities under QC 1000, considerations related to ethics and independence, and more. The knowledge checks are anonymous, the PCAOB noted, and the results won't be made public or used in the PCAOB's oversight activities.

The knowledge checks take the form of multiple-choice questions. For instance, one asks: "The firm's risk assessment process applies to which components of the QC system? (Select all that apply.)"

The possible answers are:
A. Engagement performance
B. Governance leaders
C. The monitoring and remediation process
D. Ethics and independence.

The Securities and Exchange Commission approved the PCAOB's QC standard in September. QC 1000, "A Firm's System of Quality Control", will require all registered public accounting firms to identify specific risks to their practice and design a quality control system that can safeguard against those risks. The standard will require an annual evaluation of firms' QC systems and reporting to the PCAOB. It takes effect on Dec. 15, 2025.

Last November, the PCAOB posted two pieces of staff guidance to help auditing firms familiarize themselves with the new standard.