SA 220 Quality Control explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
SA 220 brings the firm-wide quality system of SQC 1 down to a single audit. It makes the engagement partner personally responsible for the quality of each audit he or she signs, from checking independence and acceptance to reviewing the evidence before the report is dated.
SA 220, as effective for audits of financial statements for periods beginning on or after 1 April 2010, is the text discussed here. ICAI issued SA 220 (Revised), "Quality Management for an Audit of Financial Statements", together with SQM 1 and SQM 2; check its status on icai.org along with theirs.
The engagement partner must take responsibility for the overall quality of each audit, conclude on independence, be satisfied that client acceptance procedures were followed, make sure the team is competent, direct, supervise and review the work, ensure consultation, and for listed entities not date the report until the engagement quality control review is complete. The team may rely on the firm's quality system unless told otherwise. SQC 1 still applies, since ICAI deferred the mandatory date of SQM 1 and SQM 2 on 31 March 2026.
Scope and the relationship with SQC 1
Paragraph 1 says SA 220 deals with the auditor's specific quality control responsibilities for an audit, and, where applicable, those of the engagement quality control reviewer. The quality control system itself is the firm's responsibility under SQC 1, and SA 220 is premised on the firm being subject to SQC 1 (paragraph 2). The engagement team applies the procedures that fit the audit and gives the firm the information it needs for its independence system (paragraph 3). It may rely on the firm's system unless information suggests otherwise (paragraph 4). Application paragraph A2 gives examples of what the team can usually rely on: competence of people through recruitment and training, independence information gathered by the firm, acceptance systems, and regulatory compliance through monitoring.
Objective
The auditor's objective (paragraph 6) is to apply quality control procedures at engagement level that give reasonable assurance that the audit complies with professional standards and legal requirements, and that the auditor's report is appropriate in the circumstances.
The partner's duties, requirement by requirement
| Area | What the engagement partner must do | Paragraph |
|---|---|---|
| Leadership | Take responsibility for overall quality on each audit | 8 |
| Ethics | Stay alert for non-compliance by team members; decide action if it arises | 9-10 |
| Independence | Form a conclusion; obtain information from the firm and network; evaluate breaches; apply safeguards or withdraw where law allows; report any unresolved issue to the firm | 11 |
| Acceptance | Be satisfied that acceptance and continuance procedures were followed and the conclusions are appropriate | 12 |
| New information | Tell the firm promptly if facts emerge that would have led to declining the audit | 13 |
| Team | Be satisfied the team and any auditor's experts have the competence and capabilities | 14 |
| Direction, supervision, performance | Take responsibility and for the report being appropriate | 15 |
| Reviews | Take responsibility for reviews under firm policy | 16 |
| Own review of the file | By the report date, review documentation and talk to the team to be satisfied that sufficient appropriate evidence supports the conclusions | 17 |
| Consultation | Make sure difficult matters are consulted on, the conclusions agreed with the party consulted and implemented | 18 |
| EQCR | For listed entities and other audits the firm designates: confirm a reviewer is appointed, discuss significant matters, do not date the report until the review is complete | 19 |
| Differences of opinion | Follow the firm's policy | 22 |
| Monitoring | Consider the firm's latest monitoring results and any deficiencies that could affect the audit | 23 |
Direction, supervision and review in practice
The application material explains the how. Direction means briefing the team on its responsibilities (ethics, skepticism), the objectives of the work, the business of the entity, risks, possible problems and the detailed approach, and where several partners are involved, their respective roles (A13). Supervision means tracking progress, checking competence and time, handling significant matters and flagging items for consultation (A15). Reviewers consider things such as whether work met standards, whether significant matters were raised, whether consultation was documented, whether evidence is sufficient and whether objectives were achieved (A17).
The engagement partner need not review every working paper, but must review critical areas of judgment, significant risks and other areas the partner considers important at suitable stages, and document the extent and timing of the review as SA 230 requires (A18). An engagement partner who takes over mid-audit can apply the review procedures to work done to date (A19).
Engagement quality control review (paragraphs 19-22)
The reviewer must make an objective evaluation of the team's significant judgments by discussing significant matters with the partner, reviewing the financial statements and proposed report, reviewing selected documentation and evaluating the conclusions behind the report (paragraph 20). For listed entities the reviewer also considers the team's independence evaluation, consultation, and whether the selected working papers support the judgments (paragraph 21).
Paragraph 19(c) says the partner shall not date the auditor's report until the review is complete. Application paragraph A25 clarifies what completion means: the reviewer has done the paragraph 20-21 work; documentation of the review can be finished after the report date as part of assembling the final file. A28 adds that where SA 701 applies, the reviewer considers the key audit matters and the wording of that section. A26 reminds the partner to stay alert to changes in circumstances that might make a review necessary even if it was not required at the start. A30 notes that none of a smaller firm's audits may meet the criteria for a review, and that review is required for listed entities and any audits meeting the firm's own criteria. Our SQC 1 part 2 and SQM 2 article cover the firm-level and newer positions.
Documentation (paragraphs 24-25)
The auditor documents: issues about ethical compliance and how they were resolved; the conclusion on independence and the discussions with the firm that support it; conclusions on acceptance and continuance; and the nature, scope and conclusions of consultations (paragraph 24). The reviewer documents that the firm's review procedures were performed, that the review was completed on or before the report date, and that no unresolved matter makes the reviewer believe the judgments or conclusions were inappropriate (paragraph 25). The wider rules on files are in SA 230.
Illustrative example
Meera Iyer, engagement partner for Shree Textiles Ltd, a listed company, receives the firm's independence confirmation from every team member and finds that a junior holds a small shareholding in a supplier, not in the client. She records the facts, concludes that no threat to independence arises for this audit, and notes why. She reviews the revenue and inventory working papers at the interim and final stages, consults the firm's technical partner on a lease classification, and meets the engagement quality control reviewer twice. The report is dated only after the reviewer has reported that the review is complete.
Need help with audit-level quality records?
If you want your engagement acceptance, independence and review notes organised the way SA 220 expects, TaxClue's compliance advisory team can help you build the checklists. Finance teams who want to understand what their auditor will request can also use our compliance advisory service.
Key takeaways
- The engagement partner owns audit quality and must conclude on independence for each audit.
- The team may rely on the firm's quality system unless told otherwise.
- The partner reviews critical judgments and significant risks, and documents the extent and timing of that review.
- For listed entities, the report is not dated until the engagement quality control review is complete.
- SQC 1 remains the firm-level standard because the mandatory date of SQM 1 and SQM 2 was deferred.
Read next
- SQC 1, part 1: the firm's quality system
- SQC 1, part 2: review, monitoring and files
- SA 200: overall objectives of the auditor
- SQM 2: engagement quality reviews
Disclaimer: Based on the Standards on Auditing and quality standards issued by the Institute of Chartered Accountants of India, in the versions named in the article, and ICAI's announcement of 31 March 2026 on SQM 1 and SQM 2, as consulted on 3 October 2026. ICAI revises standards from time to time; check the current text and effective dates on icai.org. This article is general information, not legal advice; check the official text before acting.