Quality assurance system
By virtue of the Audit Law, réviseurs d’entreprises agréés (approved statutory auditors) and cabinets de révision agréés (approved audit firms) are subject to a quality assurance review of the audit engagements, organised according to the terms laid down by the CSSF in its capacity as oversight authority of the audit profession.
The quality assurance review takes place at least every six years. This cycle of review is brought down to three years for réviseurs d’entreprises agréés (approved statutory auditors) and cabinets de révision agréés (approved audit firms) that audit public-interest entities.
The quality assurance review consists in the assessment of the internal quality control system of the audit firm and an appropriate verification of selected engagements. It is carried out according to a common inspection methodology drawn up at EU level (CAIM) and proportionate to the scale and complexity of the activity carried out by the réviseurs d’entreprises agréés (approved statutory auditor) or the cabinets de révision agréés (approved audit firm) subject to the review.
Based on Articles 37 and 39(3) of the Audit Law, the CSSF may require all information as is necessary for the accomplishment of its tasks and access to any document in any form whatsoever and to receive a copy thereof.
After the quality assurance review, the CSSF issues, for the cabinets de révision agréés (approved audit firms) a report which includes notably:
- the preventive measures (Article 42) ordered against réviseurs d’entreprises agréés (approved statutory auditors) acting as signing partners for audit files which show significant breaches to the Luxembourg regulatory framework;
- a summary for the firm, listing the main deficiencies with respect to its internal organisation and for which the CSSF requires the implementation of corrective measures.
A follow-up is set up to verify that the audit firms concerned have taken appropriate corrective measures and that the professionals for which deficiencies have been identified in the course of their legal engagements address these shortcomings.
Laws, regulations and directives