Grant Thornton Audit Review

Every member firm is obliged to submit to an inspection of its audit practice by Grant Thornton, referred to as the Grant Thornton Audit Review (GTAR), at least once every three years. The inspection process is designed to monitor member firms’ compliance with professional standards and Grant Thornton's audit quality control policies and procedures. The GTAR is conducted by independent and suitably qualified partners and managers from other member firms under the overall direction of the executive director – quality control at Grant Thornton.

Following feedback from member firms and inspection teams, Grant Thornton recently introduced a number of enhancements to our GTAR methodology including redesigning the GTAR reports to provide more clearly an overall opinion on a firm's internal quality control system.

GTAR inspection teams use a global, intranet-based Quality Monitoring Tool (QMT) to record and keep track of findings from the inspections. Member firm management is given access to the findings relating to its firm, allowing the reports to focus on overall conclusions. This approach provides an effective way of communicating GTAR results to member firm management. Grant Thornton also provides training to member firm partners and managers on the GTAR methodology and the QMT tool.

After the GTAR visit, Grant Thornton issues an opinion based on an aggregation of findings from the on site inspection of audit engagements and the assessment by Grant Thornton of the firm's quality control system. The opinion on a firm’s quality control system will be one of the following: 

• suitably designed and operating effectively (an unqualified report), or 
• suitably designed and operating effectively except for one or more significant deficiencies, (an except for report), or 
• having material weaknesses in the design or operation of the quality control system, (an adverse report).

The GTAR reviews the conduct of audit work performed by each member firm. The inspection process includes an evaluation of policies and procedures of the member firm applicable to its assurance practice, benchmarking those policies and procedures against relevant policies and procedures of the international organisation. The inspection team reviews financial statements, audit reports and engagement files. The inspection team also interviews partners and staff on various matters.

The GTAR inspection teams assess how internal policies and procedures have been designed and implemented. Typically this requires reviewing procedures relating to areas required by ISQC1 and outlined in the Ethics and Quality Control Manual, such as ethics and independence, client acceptance and reacceptance, human resources and internal monitoring.

Where the GTAR identifies a deficiency, the member firm is expected to address the deficiency within a reasonable period of time and submit appropriate documentation to Grant Thornton. Where actions are required by member firms to address findings during the GTAR, a further visit or remote assessment is made to review progress in implementing these actions.