## Engagement Quality Control Reviewer (EQCR) and Documentation

### Engagement Quality Control Reviewer (EQCR)

#### Appointment

Entity Type	EQCR Appointment
Listed entity	Mandatory
Other entities	May be appointed (discretionary)

#### Role of EQCR

The EQCR must:

1. Determine that an EQCR has been appointed (before engagement completion)

2. Discuss significant matters arising during the engagement (including matters identified by the engagement partner)

3. Review the audit report before it is signed

> Critical Rule: The audit report cannot be signed until the EQCR review is complete.

#### Difference of Opinion Between Engagement Partner (EP) and EQCR

```

Difference of Opinion Arises

↓

Discuss to Resolve

↓

If Resolved → Proceed

↓

If NOT Resolved → Follow Firm Policy

```

> The firm must have a documented policy for handling unresolved disagreements between the EP and EQCR.

---

### Documentation

#### Timely Completion of Engagement File

Requirement	Timeline
Final assembly of engagement file	Within 60 days from the date of the audit report

#### Retention of Audit Work

Requirement	Period
Minimum retention	7 years from the date of the audit report
If Group Audit	7 years from the date of the Group Audit Report (whichever is later)

#### Ownership of Audit Documentation

> Audit documentation is owned by the Auditor (not the client).

Worked example

### Example 1

EQCR Mandatory for Listed Entity: ABC Ltd. is listed on NSE. Its auditors are Rajuk & Co. Since ABC Ltd. is a listed entity, appointment of an EQCR is mandatory. The EQCR must review all significant matters including going concern assessment, related party transactions, and key audit matters before the audit report is signed.

### Example 2

Difference of Opinion – EQCR: During the audit of XYZ Ltd. (listed), the Engagement Partner believes a provision for litigation of ₹50 crore is adequate. The EQCR disagrees, believing it is understated. They discuss the matter; if they cannot resolve it, the firm's documented conflict-resolution policy applies (e.g., escalation to the firm's managing partner or technical committee). The audit report cannot be signed until resolution.

### Example 3

Documentation Retention: An audit report for FY 2024-25 is dated 15th September 2025. The auditor must: (1) complete the final engagement file by 14th November 2025 (60 days), and (2) retain the audit working papers until at least 15th September 2032 (7 years from audit report date).

⚠️ Common exam mistakes

Stating EQCR is mandatory for all entities – it is mandatory ONLY for listed entities; for others it is discretionary.
Confusing the 60-day rule (file assembly) with the 7-year rule (retention) – these are two separate, distinct requirements.
Thinking audit documentation belongs to the client – it belongs to the auditor.
Forgetting that in group audits, the 7-year retention runs from the GROUP audit report date if that is later than the component audit report.
Not knowing the consequence of an unresolved EP vs. EQCR disagreement – the firm's policy must be followed, and the report cannot be signed until the matter is resolved.

Bare-Act text Para 15 & 24 · SA 220 – Quality Control for an Audit of Financial Statements (ICAI) · click to expand

The engagement partner shall, on or before the date of the auditor's report, through a review of the audit documentation and discussion with the engagement team, be satisfied that sufficient appropriate audit evidence has been obtained to support the conclusions reached and for the auditor's report to be issued.

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Engagement Quality Control Reviewer (EQCR) and Documentation (SQC 1 / SA 220)

Worked example

⚠️ Common exam mistakes