Quality Assurance
Wirtschaftsprüferkammer (WPK) maintains a quality assurance system. It is intended to ensure that the quality control systems of the professional practices are subject to a regular, preventive monitoring process (quality assurance reviews). Auditors, to the extent they conduct statutory audits, must have their practice monitored by an independent auditor ("peer") for quality assurance every six years. If a practice performs statutory audits as defined in § 316 German Commercial Law (HGB) for the first time, it shall undergo a quality assurance review not later than three years after the beginning of the first audit. The registration as statutory auditor and a corresponding extract from WPK´s public register are prerequisites for a valid appointment as statutory auditor.
The quality assurance review comprises an evaluation of the internal quality control system of each practice, which is evaluated in terms of its appropriateness and ability to function. This pertains particularly to compliance with the professional requirements (WPO, Professional Charter and other professional regulations), independence requirements, quality and quantity of the resources deployed as well as the remuneration charged.
The Commission on Quality Assurance is responsible for the quality assurance system within WPK.
The main responsibilities of the Commission on Quality Assurance are:
- Imposing quality assurance reviews based on a risk analysis
- Deciding on the practices’ proposed quality assurance reviewer
- Evaluating of quality assurance review reports
- Deciding on measures aimed at remedying deficiencies and on deleting the registration as statutory auditor
- Registration of quality assurance reviewers and decision on withdrawal or revocation of the registration as quality assurance reviewer
- Oversight on the quality assurance reviewers as well as
- Decision on appeals related to quality assurance reviews
The Commission on Quality Assurance shall issue annual reports on its activities. Quality assurance reviews are carried out by registered quality assurance reviewers.
The system of the quality assurance review is subject to the public professional oversight of the Auditor Oversight Body (AOB) at the Federal Office for Economic Affairs and Export Control (BAFA). AOB has the ultimate decision-making power regarding decisions of the Commission on Quality Assurance. The evaluation of the internal quality control system of audit firms that also conduct statutory audits of public interest entities (§ 316a sentence 2 HGB) is performed by AOB through inspections – as far as the public interest entities are affected.