What it is
SQMS No. 1 asks the individual with ultimate responsibility for the system to evaluate it at least annually and reach one of three conclusions: reasonable assurance, reasonable assurance except for matters related to severe but not pervasive deficiencies, or no reasonable assurance. The first evaluation is required within one year following December 15, 2025.
This checklist gathers the inputs, tests the quality objectives against evidence, supports the conclusion and records the communication that follows. It sits on top of the monitoring and remediation work. Not an AICPA product.
When to use it
- At the annual evaluation date the firm has set.
- When a deficiency is found and its effect on the conclusion must be assessed.
- To give the peer reviewer a single evaluation record.
What’s inside
- Scope, timing and responsible individuals
- Inputs: risk assessment, monitoring, deficiencies, peer review, service providers
- Evaluation of each component and the conclusion
- Communication and next-period actions
- Summary by section with sign-off
Standard cited
This template follows SQMS No. 1. It is written in our own words, except for phrases the standard requires the document to contain, with [bracketed placeholders] for client details, amounts in USD and dates as MM/DD/YYYY. Check it against the current standard and your firm’s methodology before use.
Questions
When is the first evaluation due?
Within one year following December 15, 2025, the date by which firms had to design and implement the system. After that the evaluation is performed at least annually, as of a point in time.
What does “severe but not pervasive” mean?
The standard does not define these terms in its glossary. Its application material says a deficiency may be pervasive when, for example, it affects several components, is fundamental to the system, affects several offices or affects a substantial portion of engagements of a certain type. It gives, as an example of severe but not pervasive, a culture problem confined to a smaller office. The firm evaluates severity and pervasiveness and reaches one of the three conclusions.
Who signs the evaluation?
The individual or individuals assigned ultimate responsibility and accountability for the system conclude on behalf of the firm. The firm documents the conclusion and its basis. In a small firm this is often the managing partner.
Related templates
- SQMS No. 1 Monitoring and Remediation Checklist
- Peer Review Readiness Checklist
- Firm Independence Compliance Checklist (Annual)
- Engagement Quality Review Checklist (SQMS 2)
Last updated 11/05/2026. All free templates.