Appendix 1
Evidence sources used to monitor audit quality
Table 1 shows the main evidence sources that PSAA uses to monitor audit quality for the three tests to provide a rounded view of audit quality.
Table 1: Our audit contract monitoring
| PSAA test | Sources of evidence |
| Complies with professional standards and guidance | 1. Professional regulatory reports 2. Firms’ transparency reports 3. Contract monitoring data 4. Client feedback 5. Formal and informal interactions with firms |
| Complies with contractual requirements | |
| Has excellent relationship management |
Table 2 shows the relationship between the IAASB framework and our audit contract monitoring arrangements.
Table 2: IAASB framework elements
| IAASB framework elements | Key elements of PSAA test | ||
| Complies with professional standards and guidance | Complies with contractual requirements | Has excellent relationship management | |
| Inputs: | |||
| Values, ethics and attitude | ✔ | ✔ | ✔ |
| Knowledge, skills, experience and time | ✔ | ✔ | ✔ |
| Process: | |||
| Audit process and quality control procedures | ✔ | ✔ | |
| Delivery aligned to Method Statements | ✔ | ||
| Outputs: | |||
| Auditors’ reports (opinions and AARs) | ✔ | ✔ | ✔ |
| Transparency reports | ✔ | ||
| Professional regulators’ reports | ✔ | ||
| Key interactions: | |||
| Client survey feedback | ✔ | ||
| Client communications | ✔ | ✔ | |