Compliance Briefing — November 18, 2022

Executive briefing: On November 18, 2022, the Public Company Accounting Oversight Board (PCAOB) issued a proposed standard, QC 1000, A Firm’s System of Quality Control, to replace existing quality control requirements. The proposal emphasises proactive risk assessment, firm governance accountability, technology safeguards, and continuous monitoring to strengthen audit quality.

Immediate compliance priorities

Quality objectives inventory. Document firm-level governance, ethics, acceptance, performance, and monitoring objectives in line with the proposed QC 1000 framework.
Risk assessment cadence. Establish processes to identify and respond to quality risks, including technology change management and resource constraints (QC 1000.17–.23).
Monitoring and remediation. Design inspection cycles, root-cause analysis procedures, and remediation tracking that will withstand PCAOB inspection scrutiny.

Control alignment

Governance and leadership. Align board or managing partner oversight with clear accountability for quality objectives, performance evaluation, and incentives.
Technology controls. Inventory audit tools and data analytics platforms, documenting access restrictions, change management, and data integrity safeguards required by the proposal.
Talent management. Enhance competency tracking, workload monitoring, and independence confirmations to support engagement quality.

Enablement moves

Perform a gap analysis between existing AS QC 20 policies and the proposed QC 1000 requirements, prioritising remediation sprints before the final rule.
Develop dashboards that aggregate inspection findings, independence breaches, and training metrics for leadership review.
Coordinate comment letter responses with professional bodies to inform implementation guidance and timeline expectations.

Sources

Zeph Tech supports audit firms with QC system diagnostics, technology control testing, and leadership reporting aligned to the PCAOB proposal.