COPYRIGHT NOTICE — This document is intended for internal use. It cannot be distributed to or reproduced by third parties without prior written permission from the Copyright Coordinator for the Office of the Auditor General of Canada. This includes email, fax, mail and hand delivery, or use of any other method of distribution or reproduction. CPA Canada Handbook sections and excerpts are reproduced herein for your non-commercial use with the permission of The Chartered Professional Accountants of Canada (“CPA Canada”). These may not be modified, copied or distributed in any form as this would infringe CPA Canada’s copyright. Reproduced, with permission, from the CPA Canada Handbook, The Chartered Professional Accountants of Canada, Toronto, Canada.

3061 Engagement Team: Assigning and Managing Tasks
Apr-2018

Overview

This section discusses the importance of being satisfied that the engagement team has the appropriate competence and capabilities to conduct the engagement, as well as the assignment of roles and responsibilities.

CPA Canada Assurance Standards

Office

Annual Audit

Performance Audit, Special Examination, and Other Assurance Engagements

CSQC 1.31 The firm shall also establish policies and procedures to assign appropriate personnel with the necessary competence, and capabilities to:

(a) Perform engagements in accordance with professional standards and applicable legal and regulatory requirements; and

(b) Enable the firm or engagement partners to issue reports that are appropriate in the circumstances. (Ref: Para. A31)

CSQC 1.A31 The firm's assignment of engagement teams and the determination of the level of supervision required, include, for example, consideration of the engagement team's:

  • Understanding of, and practical experience with, engagements of a similar nature and complexity through appropriate training and participation;
  • Understanding of professional standards and applicable legal and regulatory requirements;
  • Technical knowledge and expertise, including knowledge of relevant information technology;
  • Knowledge of relevant industries in which the clients operate;
  • Ability to apply professional judgment; and
  • Understanding of the firm's quality control policies and procedures.

CAS 220.14 The engagement partner shall be satisfied that the engagement team, and any auditor's experts who are not part of the engagement team, collectively have the appropriate competence and capabilities to:

(a) Perform the audit engagement in accordance with professional standards and applicable legal and regulatory requirements; and

(b) Enable an auditor's report that is appropriate in the circumstances to be issued. (Ref: Para. A11-A13)

CAS 220.A11 An engagement team includes a person using expertise in a specialized area of accounting or auditing, whether engaged or employed by the firm, if any, who performs audit procedures on the engagement. However, a person with such expertise is not a member of the engagement team if that person's involvement with the engagement is only consultation. Consultations are addressed in paragraphs 18, A22 and A23.

CAS 220.A12 When considering the appropriate competence and capabilities expected of the engagement team as a whole, the engagement partner may take into consideration such matters as the team's:

  • Understanding of, and practical experience with, audit engagements of a similar nature and complexity through appropriate training and participation.
  • Understanding of professional standards and applicable legal and regulatory requirements.
  • Technical expertise, including expertise with relevant information technology and specialized areas of accounting or auditing.
  • Knowledge of relevant industries in which the client operates.
  • Ability to apply professional judgment.
  • Understanding of the firm's quality control policies and procedures.

Assignment of the Team

CSAE 3001.36 The engagement partner shall: (Ref: Para. A68)

(a) Be satisfied that those persons who are to perform the engagement collectively have the appropriate competence and capabilities to:

(i) Perform the engagement in accordance with relevant standards and applicable legal and regulatory requirements; and

(ii) Enable an assurance report that is appropriate in the circumstances to be issued.

CSAE 3001.59 If information to be used as evidence has been prepared using the work of a responsible party’s expert, the practitioner shall, to the extent necessary having regard to the importance of that expert’s work for the practitioner’s purposes:

(a) Evaluate the competence, capabilities and objectivity of that expert;

(b) Obtain an understanding of the work of that expert; and

(c) Evaluate the appropriateness of that expert’s work as evidence.

OAG Policy

Before the completion of the planning/survey phase of an assurance engagement, the engagement leader shall

  • assess the engagement team in order to be satisfied that the engagement team, specialists and any auditor's experts, collectively have the appropriate competence and capabilities; and
  • assign roles and responsibilities. [Nov-2011]

OAG Guidance

The engagement leader is responsible for the engagement and its performance, and for the assurance engagement report that is issued.

This means the engagement leader

  • properly assesses the assignment and structure of the engagement team, including specialists and auditor's internal experts, taking into consideration the factors included in the Engagement Team Competency and Resource Assessment Template;
  • is satisfied that engagement team roles and responsibilities are properly assigned and communicated, including responsibilities for maintaining an objective state of mind and an appropriate level of professional skepticism and for performing work according to the ethical principle of due care;
  • in assigning roles and responsibilities, matches the level of knowledge and experience to the risk and complexity of the tasks;
  • encourages a culture of knowledge sharing and communication, so that engagement team members draw on the totality of their understanding of the entity and their personal knowledge and experience; and
  • clearly defines the tasks to be performed, including the review responsibilities and reporting lines to the engagement leader.

The composition of the engagement team and the proper assignment of roles and responsibilities are essential to the performance of an effective audit. Every audit is different, and the engagement team is structured to meet those specific circumstances.

The engagement leader assigns roles and responsibilities that provide for development of each team member, supported by an integrated coaching culture, by

  • providing team members with a range of challenging opportunities to build their knowledge, relationships, and experience;
  • engaging team members in setting expectations and measurable goals aligned to the audit, Office, and personal success;
  • leading by example and sharing knowledge and experience; and
  • providing for high-quality on-the-job coaching.

This means that auditors

  • develop their technical competence, team-working skills, knowledge-sharing abilities, and professionalism;
  • perform high-quality engagements; and
  • manage risk appropriately.

Related Sections

OAG Audit 1081 Selection of engagement quality control reviews and appointment of quality reviewers
OAG Audit 3062 Engagement leader responsibilities for audit quality
OAG Audit 3063 Quality reviewer responsibilities
OAG Audit 3065 Team members