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To drive continuous improvements in audit quality, the Accounting and Financial Reporting Council (AFRC) today published the Inspection Insights (The Insights) and an explanatory video on the inspection of non-PIE practice units.

As at 30 September 2023, the AFRC has inspected 20 PIE engagements, 22 non-PIE engagements, 11 systems of quality management and 12 anti-money laundering (AML) and counter-terrorist financing (CTF) compliance monitoring.  The Insights reveals certain areas of improvement related to the implementation of the new Hong Kong Quality Management Standards despite that it became effective on 15 December 2022.  

Ms Janey Lai, Acting CEO and Head of Inspection of the AFRC stressed, “We urge auditors to benefit from our Insights by thoroughly reviewing it and taking our recommended actions to address their identified deficiencies and relevant issues.  We will continue to take a proportionate approach to the inspections of non-PIE practice units while not compromising the public interest.  We strongly encourage non-PIE practice units to watch our video and get prepared for our upcoming inspections. At the same time, we will also maintain our risk-based approach and initiate special inspections on PIE auditors with unsatisfactory inspection results to uphold audit quality, so as to effectively protect the public interest.”

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