Technical vs peer review

M. V. Kali Prasad | Updated on May 25, 2012



What is the difference between a technical review and a peer review?


Both reviews are initiated by the Institute of Chartered Accountants of India (ICAI) and aim to improve the quality of audit and acceptability of the financial statements. The reviewers, in both cases, are chartered accountants with experience, trained to carry out the work. Reviews are carried out on the work performed by the Auditors.


Authority: Peer review is directed by the peer review board of the ICAI, whereas technical review is under the aegis of the Financial Reports Review Board (FRRB) of the ICAI. Thus, though both are carried out by the ICAI, they are carried out by two different arms.

Subject of review: Peer review is carried out on the practice unit, which is essentially a firm of Chartered Accountants whereas technical review is carried out on the financial statements and reporting.

Appointment: The practice unit chooses from among three names suggested to it by the peer review board. The technical reviewer is appointed by the FRRB.

Periodicity of review: Peer review is an ongoing process, done once in a three-year time period while there is no such time measure for technical review. Technical review is carried out on a financial statement and reporting as on a particular date.

Objective of review: Peer review is carried out with the aim of improving the overall performance of the practice unit. Technical review is to examine the financial statements and reports of the statutory auditor. During peer review, the reviewer examines the functioning of the firm, audit plans and programmes, bases of accepting or rejecting an audit evidence, adherence to standards of auditing, training of the audit staff, maintenance of records by the practice unit, etc.

Technical reviewer works on a different set of information, such as the format of the financial statements, notes to accounts, compliance with the broad framework of accounting, audit report, content of report, assurances obtained by the auditor for comments and statements in the report, etc.

Period under review: The peer reviewer delves into the records of the practice unit over a period of three years whereas the technical review is confined to just one financial statement.

Size of the study: The Peer reviewer selects certain samples from the clients, papers, documents of the practice unit. The technical review is confined to one financial statement reporting, which is a single document.

Modalities of working: The peer reviewer goes into the working of the firm. Thus it is more into substantive procedures. Technical review is more into the format, disclosure and compliance procedures. Peer reviewer covers all types of the work performed by the practice unit which includes tax audits, internal audits also. Technical review confines itself only to the financial reporting.

ICAI view: The ICAI considers peer review as a hand-holding exercise where one member of the ICAI helps another in improving the standards of auditing. In the case of a technical review, the implications are not the same.

These differences are exhaustive but not all-inclusive.

(The author is a Hyderabad-based chartered accountant.)

Published on May 25, 2012

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