by John McCarthy Consulting Ltd. | Jun 30, 2024 | Blog, News
On 19 June 2024 the Minister for Enterprise, Trade and Employment, Peter Burke TD, signed into law the European Union (Adjustments of Size Criteria for Certain Companies and Groups) Regulations 2024 which increases the balance sheet and turnover thresholds for ‘micro’, ‘small’, ‘medium’ and ‘large’ companies in the Companies Act 2014 by 25 per cent.
For a full list of the thresholds see our new publication here for €60+VAT.
This means that more companies will become ‘micro’ and ‘small’ categories and qualify for audit exemption and the ability to abridge their financial statements.
The regulations apply to financial years commencing on/after 1 January 2024, with the option to apply them to financial years commencing on/after 1 January 2023.
For more on AML related matters go to:
For more on the whole ISQM process for audit firms, please see our ISQM 1 Toolkit on our website here.
Also, on our website we have:
- Letters of engagement and similar templates (all updated since May 2024) – Please visit our website here where immediate downloads are available in Word format here. A bulk discount is available for orders of five or more items bought together.
- ISQM TOOLKIT, or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard, please contact John McCarthy FCA by email at john@jmcc.ie.
We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements.
The ISQM TOOLKIT 2022 is available to purchase here.
by John McCarthy Consulting Ltd. | Jun 25, 2024 | Blog, News
A 2022 article warning private schools and universities that appeared on the law firm website Withersworldwide is worth noting. It warns private schools and universities that they are at particular risk of receiving the proceeds of bribery and corruption and legitimising them. These warnings also extend to the possibility of financing terrorism.
Anyone in a senior management position and, in particular, responsible for the financial side of a private school or university should ask themselves the following (non-exhaustive list of) ‘red flag’ questions about a payment:
- Is the payer native to, or resident in, a high-risk country?
- Are the funds coming from a foreign bank account?
- Is the payer a Politically Exposed Person (see Section 37 (10) of the Criminal Justice (Money Laundering & Terrorist Financing) Acts 2010 to 2021), subject to sanctions or designated as (or associated with) a proscribed organisation?
- Are the funds part of a complex or illogical arrangement, such that it is unclear who is making the payment, e.g. from an offshore company?
- Has the payer taken steps to conceal their identity? Has anyone in the organisation ever met the payer in person?
- Are the payer’s assets inconsistent with their known legitimate income?
- Is the payment made up of a disproportionate amount of private funding, bearer’s cheques or cash?
- Are significant amounts being offered (unnecessarily) in advance or is the school or university being put under pressure to complete the transaction quickly without good justification?
- Is any of the information provided by the payer suspicious (e.g. falsified) or has information been withheld?
- Is a refund being requested for an overpayment (and if so, to different accounts)?
Sometimes the answers to these questions will be perfectly reasonable and innocent. Remain on the alert to the potential ML and terrorism risks where the source of funds is unclear or concerning, especially where a payment would tick more than one of the boxes listed above.
For more on AML please see our Anti-Money Laundering Policies Controls and Procedures Manual on our website. — View the table of contents here.
Please go to our website to see our:
- Anti-Money Laundering Policies Controls and Procedures Manual (March 2022) — View the table of contents
- AML Webinar (December 2023) available here, which accompanies the AML Manual. It explains the latest legal AML reporting position for accountancy firms and includes a quiz. Upon completion you receive a CPD certificate for attendance in your inbox.
- Letters of engagement and similar templates—Please visit our website here where immediate downloads are available in Word format. A bulk discount is available for orders of five or more items bought together.
- ISQM TOOLKIT, or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard, please contact John McCarthy FCA by email at john@jmcc.ie.
- We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements. The ISQM TOOLKIT 2022 is available to purchase here.
by John McCarthy Consulting Ltd. | Jun 18, 2024 | Blog, News
Following on from last week’s blog on cold file reviews and ISQM 1, this week we look at the various factors that can cause changes to the monitoring and remediation elements of ISQM 1.
The following variables are usually areas that need updated:
- The quality objectives set out in the system of quality management (SoQM);
- The quality risks of their assessments; and
- The responses to those risks.
Changes in these areas are mainly a result of:
- Changes in the nature and circumstances of the firm and its engagements; and
- Remedial actions to address deficiencies in the system of quality management.
These changes can arise in a variety of ways, such as:
- Changes to quality objectives;
- A need for new additional quality objectives g. if the firm opens a new office, merges with another firm or starts providing a new service;
- Additional quality objectives established by the firm may no longer be needed, or may need to be modified; and
- Root cause analysis (RCA) may identify that previous attempts at fixing issues from past cold file reviews are no longer be needed, need to be modified, or require a new solution.
Remember that the Specified Responses prescribed by the standard (detailed here in paragraph 34) must not be modified or removed, unless one or more of them is no longer relevant to the firm. The firm may decide that it’s appropriate to modify how these Specified Responses are designed and implemented.
The types of changes that can be triggered by the cold file review process broadly fall into two categories:
- Changes to quality risks such as:
- New quality risks are identified;
- Existing quality risks no longer qualify as quality risks;
- Existing quality risks need to be modified; and
- Existing quality risks need to be reassessed.
- Changes to responses to quality risks such as:
- New responses may be designed and put into action;
- Existing responses may be discontinued and deemed no longer appropriate; and
- Existing responses may need to be adjusted for changes in circumstances such as a new audit programme.
For more on the whole ISQM process please see our ISQM 1 Toolkit on our website here.
Please go to our website to see our:
- Anti-Money Laundering Policies Controls and Procedures Manual (March 2022) — View the table of contents
- AML Webinar (December 2023) available here, which accompanies the AML Manual. It explains the latest legal AML reporting position for accountancy firms and includes a quiz. Upon completion you receive a CPD certificate for attendance in your inbox.
- Letters of engagement and similar templates—Please visit our website here where immediate downloads are available in Word format. A bulk discount is available for orders of five or more items bought together.
- ISQM TOOLKIT, or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard, please contact John McCarthy FCA by email at john@jmcc.ie.
- We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements. The ISQM TOOLKIT 2022 is available to purchase here.
by John McCarthy Consulting Ltd. | Jun 10, 2024 | Blog, News
Are cold file reviews necessary? A good question you might say.
One of the main characteristics of ISQM (Ireland) 1 (hereafter ISQM 1) (ISQM1 Updated Oct 2023) is that the standard is iterative, and so it is implemented is by carrying out audits of cold file and hot file reviews. Ideally these reviews are carried out by someone experienced and unconnected with the audit assignment so that the results are fully objective and up to date.
One objective of the reviews is to identify issues that may require amendment in the ISQM so that it is a constantly evolving document.
Per ISQM 1 requirements, the monitoring process must provide a basis for identifying deficiencies in the system of quality management such that prompt remedial action can be taken, and the deficiencies can be communicated to the audit teams without delay.
ISQM 1:38 requires the monitoring process to include the inspection of completed audits (cold file reviews). The cold file reviews must include at least one completed audit from each Responsible Individual on ‘a cyclical basis determined by the firm’.
Bear in mind that the monitoring process does not only involve carrying out cold file reviews. The system of quality management must be generally monitored to achieve the objectives of ISQM 1. These objectives are set out in the question: “What is the purpose of the monitoring and remediation element of ISQM 1?”
For more on the whole ISQM process please see our ISQM 1 Toolkit on our website here.
Please go to our website to see our:
- Anti-Money Laundering Policies Controls and Procedures Manual (March 2022) — View the table of contents
- AML Webinar (December 2023) available here, which accompanies the AML Manual. It explains the latest legal AML reporting position for accountancy firms and includes a quiz. Upon completion you receive a CPD certificate for attendance in your inbox.
- Letters of engagement and similar templates—Please visit our website here where immediate downloads are available in Word format. A bulk discount is available for orders of five or more items bought together.
- ISQM TOOLKIT, or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard, please contact John McCarthy FCA by email at john@jmcc.ie.
- We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements. The ISQM TOOLKIT 2022 is available to purchase here.
by John McCarthy Consulting Ltd. | May 1, 2024 | News
The Scenario: You have successfully passed a regulatory AML inspection review. You have some follow-up tasks that need completed before your next review.
You have recently received confirmation that the AML inspection process has been completed successfully.
There are a few ‘mopping up’ matters that need following-up, and your professional body has communicated with you with a description of the main issues that you need to address before the next review.
Some important Do’s and Don’ts:
Do:
- Promptly acknowledge receipt of that confirmation;
- Ensure that the follow-up matters are properly and promptly addressed – they will undoubtedly be checked at the next review;
- Ensure to have external AML Compliance Reviews in the interim years so that your procedures stay in shape; and
- Keep your AML training up to date.
Don’t:
All our CPD courses are listed here, including our Audit Update webinar.
To hear more about the latest AML developments and how to be on the alert for suspicions of money laundering and terrorist financing under the Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 to 2021, see our latest Anti-Money Laundering webinar here.
Please also go to our website to see our:
- Anti-Money Laundering Policies Controls & Procedures Manual (March 2022) – View the Table of Contents click here.
- AML Webinar (December 2023) available here, which accompanies the AML Manual. It explains the latest legal AML reporting position for accountancy firms and includes a quiz. Upon completion, you receive a CPD Certificate of attendance in your inbox.
- letters of engagement and similar templates. Please visit our site here where immediate downloads are available in Word format. A bulk discount is available for orders of five or more items if bought together.
- ISQM TOOLKIT or if you prefer to chat through the different audit risks and potential appropriate responses presented by this new standard, please contact John McCarthy FCA by e-mail at john@jmcc.ie.
- We typically tailor ISQM training and brainstorming sessions to suit your firm’s unique requirements. The ISQM TOOLKIT 2022 is available to purchase here.
