What it is
SQMS No. 1 requires a firm to monitor its system of quality management, evaluate findings and deficiencies, investigate root causes and remediate. This workbook is the working record: a monitoring plan by component, a log of engagement inspections, a coverage view for each engagement partner, a findings log and the annual evaluation.
Findings carry a severity, root cause, remediation action, owner, due date and status, with days open and overdue flags. The evaluation tab counts open and severe deficiencies and records the conclusion.
When to use it
- Running the firm’s monitoring and remediation process.
- Keeping evidence of inspections and the follow-up of findings.
- Preparing for the annual evaluation or a peer review.
What’s inside
- Monitoring plan with frequency, last performed, next due and status
- Engagement inspection log and partner coverage against the firm’s cycle
- Findings log with severity, root cause, remediation and re-test result
- Annual evaluation tab with conclusion
Standard cited
This template follows AICPA 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
What is the inspection cycle?
SQMS 1 calls for inspecting completed engagements on a cyclical basis, with at least one engagement of each engagement partner inspected over the cycle. The cycle length is a firm decision entered on the Partner Coverage tab.
What is a severe deficiency?
SQMS 1 requires the firm to evaluate the severity and pervasiveness of the deficiencies it identifies, including their root causes, and to respond with urgency in proportion to them. Apply the standard’s definition of severe deficiency when you rate a finding; the log records the firm’s conclusion.
Does the log replace the firm’s policies?
No. It records monitoring and remediation. The quality objectives, risks and responses stay in the firm’s own documentation.
Related templates
- Peer Review Readiness Checklist
- Engagement Quality Review Checklist (SQMS 2)
- Staff Competence and Training Matrix
Last updated 11/05/2026. All free templates.