In the opening vignette, the concept of audit quality indicators (AQIs) was discussed. These AQIs are quantitative measures that provide insight into audit quality. The intent is to have firms publish these AQIs in an audit quality report and have it publicly available.

REQUIREDa. How useful do you think AQIs are to potential clients and financial statement users?

b. Do you think Canada?s regulators should require that firms provide an Audit Quality Report and publish their AQIs? Why or why not?

c. Below is an example of some common factors associated with audit quality. Propose a quantitative measure that would provide insight into that indicator.

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Example Calculation Audit Quality Indicator Element Leadership and Tone at Top How top leadership is being viewed by audit staff. Human All personnel participate in continuing professional education and profes- sional development training. Resources Adequate partner involve- ment in all phases of audit. Engagement Performance Adequate allocation of audit hours to phases in the audit. Monitoring Quality Review Results.