Appendix №1

to the Order of the Ministry of Finance of the Russian Federation of January 9, 2019 No. 2n

The international standard of quality control 1 "Quality control in the auditing organizations booking audit and survey verifications of the financial reporting, and also performing the other tasks providing confidence, and tasks on rendering the accompanying services"

The international standard of quality control (MSKK 1) "Quality control in the auditing organizations booking audit and survey verifications of the financial reporting, and also performing the other tasks providing confidence, and tasks on rendering the accompanying services" should be considered together with MCA 200 "Main objectives of the independent auditor and carrying out audit according to International standards of audit".

Introduction

Scope of this standard

1. This International Standard of Quality Control (ISQC) establishes obligations of auditing organization in the field of its quality control system of audit and survey verifications of the financial reporting, and also other tasks providing confidence, and the accompanying services. This MSKK should be considered together with the relevant ethical requirements.

2. Additional standards and recommendations concerning obligations of personnel of auditing organization for control procedures of quality by specific types performed contain in other official documents of Council for international standards of audit and the tasks providing confidence (the official name on the website IFAC the International Auditing and Assurance Standards Board(R) (IAASB(R)) Council for international standards of audit and the tasks providing confidence). MCA 220 <1>, for example, describes control procedures of quality when carrying out financial records audit.

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<1> MCA 220 "Quality control in case of carrying out financial records audit".

3. The quality control system includes the policy directed to goal achievement, established in Item 11, and the corresponding procedures necessary for implementation and monitoring of their observance.

Scope of this standard

4. This MSKK is applied by all organizations of professional accountants to audit and survey verifications of the financial reporting, and also the other tasks providing confidence and the tasks connected with rendering the accompanying services. Nature and amount of policy and the procedures developed by this or that specific auditing organization for observance of this MSKK will depend on different factors, such as the size and characteristics of activities of auditing organization, and also on whether it is part of network.

5. This MSKK establishes the purpose of auditing organization in case of observance of this standard and contains the requirements designed to provide achievement of this purpose by auditing organization. Besides, it contains the corresponding instructions in the form of recommendations about application and the other explanatory materials described further in Item 8, and the prolog determining the context necessary for proper understanding of this standard, and also determination.

6. This purpose determines context in which requirements of this MSKK are established, and is intended for assistance of auditing organization:

- in understanding that it is necessary to execute;

- in decision making about whether it is necessary to take additional measures for achievement of this purpose.

7. Requirements of this MSKK are stated using verb "shall".

8. Where it is necessary further explanations of relevant requirements are provided in recommendations about application and other explanatory materials and recommendations about their accomplishment are made. In particular, they may contain:

- more detailed instructions specifying value of this or that requirement and its scope of application;

- examples of policy and procedures which can be pertinent in specific circumstances.

In spite of the fact that these recommendations about application in itself are not requirements, they matter for the correct application of relevant requirements of the standard. These recommendations about application and other explanatory materials may contain also initial information on the questions considered in this MSKK. When it is pertinent, on application and other explanatory materials join in materials the additional reasons concerning specifics of auditing organizations of public sector or small auditing organizations. These additional reasons help the correct application of relevant requirements of this MSKK. Nevertheless they do not limit and do not narrow obligation of auditing organization on application and observance of the requirements containing in this MSKK.

9. The Section "Determinations" includes the description of values of some terms accepted for the purposes of this International standard of quality control. They are brought for assistance in the sequence of application and interpretation of this MSKK and do not assume replacement of determinations which can be established in the laws, regulations or other documents for other purposes. The terms determined in this MSKK are included in the Dictionary of the terms relating to the International standards issued by Council for international standards of audit and the tasks providing confidence as a part of the Collection of international standards of quality control, audit and survey checks, other tasks providing confidence, and tasks on rendering the accompanying services, the published MFB. The dictionary of terms also contains the description of other terms which are found in this MSKK and it is designed to promote uniformity and the sequence in case of interpretation and transfer.

The effective date

10. Quality control systems according to requirements of this MSKK shall be created till December 15, 2009.

Purpose

11. The purpose of auditing organization consists in implementing and supporting the quality control system allowing this organization to receive reasonable confidence that:

(a) the organization and its employees observe professional standards and applicable legislative and normative requirements;

(b) the conclusions issued by the organization or heads of tasks have proper character in specific circumstances.

Determinations

12. In this MSKK the following terms have the stated below values:

(a) date of the conclusion - the date chosen by the practicing specialist for dating of the conclusion;

(b) documentation on task - record about the performed work, the received results and conclusions drawn by the practicing specialist (other terms, such as "working documents" or "work materials" are sometimes used)

(c) the head of task <2> - the partner or other employee of auditing organization who is responsible for task and its accomplishment, and also for the conclusion issued on behalf of auditing organization and to whom are provided if it is necessary, proper powers the professional organization, the legal entity or regulating authority;

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<2> In appropriate cases it is necessary to understand the equivalents of these terms applied in public sector as the terms "head of task", "partner" and "auditing organization".

(d) task performance quality check - the process executed as of or before date of the conclusion and designed to estimate objectively significant judgments of auditor group and its conclusions drawn in case of conclusion formulation. Verification process of quality of task performance is intended for financial records audit of the organizations which securities are admitted to organized trading, and other tasks, in case of their availability, which as the auditing organization established, require task performance quality check;

(e) person performing task performance quality check - the partner, other employee of auditing organization, the third party of proper qualification, or group of such persons, nobody of which is part of auditor group, with the sufficient and proper experience and powers allowing to estimate objectively significant judgments which are made auditor group, and conclusions to which it came in case of conclusion formulation;

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