Integrated and aligned in the member ifrms since 1 July 2019 is consistent with right way the approach and principles underlying the new ISQM 1 model. Both ISQM 1 and QMSE implement Our audit quality objectives are founded a quality management approach at both a ifrm on having the right people, supported by and engagement level that shifts the focus to effective methodologies, processes, and a more proactive management of the quality of technology, appropriately directed and engagements, supported by ongoing, real-time supervised. These represent the capabilities monitoring and timely and effective remediation that we believe are relevant to achieving of any deifciencies that are identiifed. and sustaining audit quality. To help our member ifrms apply these capabilities, we Systems of quality management in compliance have a number of dedicated functions within with ISQM 1 are required to be designed and the PwC network that develop practical implemented by 15 December 2022, and the tools, guidance and systems to support evaluation of the system of quality management audit quality. We’ve integrated and aligned is required to be performed within one year after these elements to create a comprehensive that date. In terms of the updates needed to the and interconnected quality management QMSE framework to comply with ISQM 1, we do framework, Quality Management for Service not expect a signiifcant additional burden on Excellence (QMSE), that each member member ifrms, as any necessary updates relate ifrm implements and tailors to relfect its to areas that they were already likely to be individual circumstances. addressing. Rather, these changes will relfect explicit requirements in ISQM 1 being made In December 2020, the International similarly explicit in the QMSE framework. Auditing and Assurance Standards Board (IAASB) issued its new Quality Delivering quality Management Standards - International Standard on Quality Management (ISQM) Central to the QMSE framework is the recognition 1, ISQM 2, and International Standard that quality management needs to be embedded on Auditing 220 (Revised). ISQM 1, in in everything we do as individuals, teams, and ifrms. To support consistency and guide our member ifrms, applying a quality management approach, is a signiifcant change from ISQC 1, the the quality objectives are supported by designated standard that it replaces. The QMSE activities that we believe are vital to achieving them, focused mainly on building a quality infrastructure framework that has been in place in PwC