Introduction to the revised ISSAI 140 – Quality management for SAIs

In December 2020, the IAASB issued a new suite of quality management standards (ISQM 1 and ISQM 2) replacing the previous ISQC 1 and revised its ISA 220 standard (quality management of an audit of financial statements). The changes emphasise that the auditor’s objective is about managing quality and associated procedures in a risk-based and dynamic way in order to achieve the required level of quality, rather than implementing a static set of quality control procedures. INTOSAI revised its own standard on quality control accordingly.

The new standard 140 has been built around 7 requirements:

  1. establishing the system of quality management
  2. establishing quality objectives
  3. identifying and assessing quality risks
  4. designing and implementing responses
  5. establishing a monitoring and remediation process
  6. evaluating and concluding on the effectiveness of the system of quality management
  7. documenting the system of quality management

Overall, SAIs are free to design, implement and operate a system of quality management taking into account their changing nature and circumstances. SAIs will manage their system of quality management in a dynamic way, by adapting it to changes in the nature and circumstances of the SAI and its engagements.

The new ISSAI 140 is applicable from 1 January 2025, when it will be moved into the framework and replace the current version of ISSAI 140.

The English and Arabic versions are available to readers.  Versions of revised ISSAI 140 in French, German and Spanish will be available shortly.