The AICPA’s quality management standards, issued by its Auditing Standards Board in June 2022, require firms that conduct any audits, attest examinations, financial statement or attest reviews, compilations, or agreed-upon-procedures engagements to design and implement a quality management (QM) system by Dec. 15, 2025, and conduct an evaluation with one year.

By the latest standards, a compliant QM system includes establishing quality objectives, assessing specific risks to quality, and designing and implementing responses to address those risks. In addition, the approach calls for continuous improvement and ongoing remediation over time. 

If your firm hasn’t yet begun the transition from a system of quality control to one of quality management, you still can finish on time. Doing so is critical, as firms whose peer review year ends after Dec. 15, 2025, will have their systems reviewed under the new quality management standards. Firms that fail to comply may not pass their peer review.

Now is the time to start if your firm hasn’t already, and the AICPA is here to help.

The white paper, “Is Your Firm’s New Quality Management System on Target for December 2025?,” newly posted on the members-only COCPA Resource Center, is updated and adapted from an article originally published in the Journal of Accountancy in November 2023 by the AICPA & CIMA, together as the Association of International Certified Public Accountants.

The white paper details how to choose an implementation strategy and a documentation approach, and offers tips and insights on each component of a QM plan. The authors note that while most of the necessary components are not new to your firm’s system of quality control, when your firm transitions to a system of quality management, you will need to consider new and more robust requirements during implementation.

The plan components are:

1. The firm’s risk assessment process
2. Governance and leadership
3. Relevant ethical requirements
4. Acceptance and continuance of clients and specific engagements
5. Engagement performance
6. Resources
7. Information and communication
8. Monitoring and remediation process

The white paper also offers an overview of the new standards, tips to keep your firm’s implementation of the QM standards on track, and links to additional educational resources on the new QM implementation requirements

The AICPA has developed a free practice aid to help firms design and implement their QM system. Click here for AICPA tools and resources to help you get started.

The following resources provide additional guidance and support on the QM system implementation requirements.

• CPE self study: Understanding and Implementing the New Quality Management Standards: Enhance your understanding of risk assessment and QM to implement effective QM systems for your firm’s A&A practice.

• Four-part webcast series (attend one or more):

1. New Quality Management Standards: Resources — Expectations for Firms and Engagement Partners: In a thriving quality management system for your firm’s A&A practice, your resources need to be allocated properly. Get valuable actionable insights.
2. New Quality Management Standards: What’s New for Firms’ Monitoring and Remediation Processes: Statement on Quality Management Standards No. 1 requires firms to perform enhanced monitoring and remediation activities. Start now by learning what you need to know to comply with the new standards.
3. New Quality Management Standards: Bringing It All Together — Exploring All Components of a Quality Management System: The newly issued Statement on Quality Management Standards No. 1 requires firms to design, implement, and operate a new quality control system by Dec. 15, 2025.
4. New Quality Management Standards: A Practical Approach to Risk Assessment and Response: Learn about SQMS No. 1 and understand the new risk-based approach to quality management, with emphasis on creating processes tailored to your firm’s needs for its A&A practice.