We often are asked: “Who audits the auditors?” Government Auditing Standards require that audit organizations have an external peer review of their auditing, attestation engagement and non-auditing practices every three years. A peer review provides reasonable assurance that the audit organization is complying with applicable professional auditing standards. It also determines whether the audit organization’s internal quality control system is adequate and the audit organization is in compliance with its quality control policies and procedures.
A peer review is conducted in accordance with the standards and guidelines contained in the Peer Review Guide published by the Association of Local Government Auditors (A.L.G.A.) and reviewed and endorsed by the U. S. Government Accountability Office. The peer review process has three phases: (1) preparation, (2) site visit, and (3) reporting.
During the on-site visit, the peer review team reviews policies and procedures; audit and attestation reports and supporting working papers; continuing professional education records; and qualifications of audit staff. Government Auditing Standards also require reviewers to interview professional staff to assess their understanding of, and compliance with, relevant internal quality control procedures. The A.L.G.A. peer review process can result in three levels of compliance: full, satisfactory, or noncompliance.
Our next peer review is planned for 2013.