APES 320 in brief
APES 320 Quality Management for Firms that provide Non-Assurance Services is the mandatory quality standard issued by the Accounting Professional & Ethical Standards Board (APESB). It requires every Australian public practice firm whose members belong to CPA Australia, Chartered Accountants Australia and New Zealand (CA ANZ) or the Institute of Public Accountants (IPA) to design, document and monitor a system of quality management for non-assurance work such as tax, bookkeeping, compilation and advisory services.
The current version was reissued in February 2022 and took effect on 1 January 2023. It applies to sole practitioners and large multi-partner firms alike. Firms must cover seven elements, and quality reviewers check that what the manual says is what the firm actually does.
Key fact | Detail |
Full name | APES 320 Quality Management for Firms that provide Non-Assurance Services |
Issued by | Accounting Professional & Ethical Standards Board (APESB) |
Current version | Reissued February 2022; replaced APES 320 Quality Control for Firms (September 2019) |
Effective date | 1 January 2023 (early adoption was permitted) |
Applies to | Members in public practice in Australia providing non-assurance services |
Required elements | 7 |
Assurance equivalent | ASQM 1, issued by the Auditing and Assurance Standards Board (AUASB) |
Companion standard | APES 325 Risk Management for Firms |
Who checks compliance | CPA Australia, through its Best Practice Program (formerly the Quality Review Program), and CA ANZ and the IPA, through their quality review programs |
Who must comply with APES 320?
Every member in public practice in Australia must follow APES 320's mandatory requirements. Members practising overseas must also follow it unless local law or regulation prevents them.
The standard defines a "firm" to include a sole practitioner, so size is not an exemption. A sole practitioner with no staff is excused only from the requirements that relate to staff. They must still document their system of quality management. A firm that performs no audits, reviews or other assurance work applies APES 320 to every engagement.
The form of documentation is a matter of judgement. A small firm can use simpler records, such as notes and checklists, provided they evidence each element.
APES 320 and the TPB's quality management obligation
Registered tax agents and BAS agents also have a quality management obligation under section 40 of the Tax Agent Services (Code of Professional Conduct) Determination 2024, which the Tax Practitioners Board (TPB) oversees. It has applied since 1 January 2025 for practices with more than 100 employees at 31 July 2024, and since 1 July 2025 for all other registered agents.
The two obligations overlap but are not identical. APES 320 binds members of CPA Australia, CA ANZ and the IPA, while the TPB obligation applies to every registered tax and BAS agent, whether or not they belong to a professional body. For most accounting firms, the practical answer is one quality management system that covers tax and BAS work and is documented against both. Our guide to the TASA Determination 2024 explains the TPB requirements in more detail.
The seven elements of APES 320
APES 320 requires policies and procedures for seven elements (paragraph 3.5 and section 4 of the standard).
Element | What it covers | Evidence a reviewer may ask for |
1. Governance and leadership (4.1–4.3) | Who owns quality. The CEO, managing partner, or managing board takes ultimate responsibility, and commercial considerations must not override quality. | A documented allocation of responsibility; meeting notes showing quality is discussed |
2. Professional standards (4.4–4.9) | Compliance with APES 110 Code of Ethics, including confidentiality and independence where relevant. | Ethics and independence confirmations; a breach register |
3. Acceptance and continuance (4.10–4.17) | Deciding whether to take on or keep a client or engagement, based on integrity, competence and capacity. | Acceptance checklists; signed engagement letters |
4. Resources (4.18–4.36) | People, training, technology and any external service providers. | CPD records; training logs; software and data security controls |
5. Engagement performance (4.37–4.58) | Supervision, review, consultation on difficult matters, and engagement documentation and retention. | Reviewer sign-offs; consultation notes; complete workpapers |
6. Information and communication (4.59–4.64) | How policies reach staff and how the firm communicates internally and externally. | Staff acknowledgements of the manual; internal updates |
7. Monitoring and remediation (4.65–4.75) | Ongoing evaluation, regular inspection of completed engagements, complaints and allegations, and fixing deficiencies. | Inspection reports; a complaints register; a remediation log |
The monitoring element is where many firms fall short. APES 320 requires periodic review of completed engagements as part of the monitoring process. Firms must also give staff a clear way to raise concerns without fear of reprisal.
Monitoring a quality system is one of the biggest issues that arise in the area of quality for accounting practices. In the past, we have seen many firms fail to meet the monitoring element of APES 320. To overcome this, they have engaged an external quality consultant like QAFA to undertake the review of completed engagements to ensure compliance with APES 320.
APES 320 vs ASQM 1: what's the difference?
APES 320 covers quality standards for non-assurance services, while ASQM 1 covers quality standards for audits, reviews and other assurance engagements. The two are aligned at a high level. For a full explanation of the audit standard, see our ASQM 1 guide.
| APES 320 | ASQM 1 |
Issued by | APESB | AUASB |
Covers | Tax, compilation, bookkeeping, advisory and other non-assurance work | Audits, reviews and other assurance and related services |
In force from | 1 January 2023 | 15 December 2022 |
Structure | 7 elements | 8 components, including a formal firm risk assessment process |
Monitoring | Ongoing evaluation plus regular inspection of at least one completed engagement per engagement partner | Monitoring and remediation process, plus a documented evaluation of the system at least annually |
A firm that provides both assurance and non-assurance services must show compliance with both standards. In this case, firms are required to prepare and keep two manuals.
Common APES 320 compliance problems
An incomplete or missing quality control manual is one of the most common findings in professional body quality reviews, according to CA ANZ. The problems we see most often are:
A real example from our reviews is firms that have no quality manuals in place at all, or whose manuals are out of date and so don't meet the current standards. Both are common review findings. Not having these manuals in place comes with a cost because if the practice prepares the manuals itself, it loses chargeable hours and productivity. Preparing a manual can take 20 to 30 hours from start to finish.
- A manual that doesn't match practice. CPA Australia gives the example of a manual promising quarterly reviews with no record that they happen. A stated procedure without evidence can be treated as non-compliance.
- An out-of-date manual. Many manuals still refer to the pre-2023 Quality Control for Firms version, or haven't been updated after new services, software or staff.
- No inspection evidence. The firm has never inspected a completed engagement for each engagement partner, or the partner inspected their own file.
- Unclear responsibility. The manual doesn't name who holds ultimate and operational responsibility for quality.
- Not enough time. Busy practices postpone quality work until a review letter arrives.
New pressures are also emerging. APESB's 2026 post-implementation review notes that firms are asking how the AML/CTF and privacy law reforms effective 1 July 2026, and the use of AI tools, affect their quality systems.
How to prepare for an APES 320 quality review
Quality reviews are run by CPA Australia through its Best Practice Program (formerly the Quality Review Program), and by CA ANZ and the IPA through their own review programs. Whichever body reviews you, the preparation is the same:
- Confirm which standards apply. Non-assurance work needs APES 320; any assurance work also needs ASQM 1. Every firm also needs an APES 325 risk management framework.
- Check that leadership responsibility is documented. Name the person with ultimate responsibility and anyone with operational responsibility.
- Test every promise in your manual. For each "we will" statement, find the evidence. If you can't, change the procedure or start keeping the record.
- Complete your inspections. Inspect at least one completed engagement per engagement partner, preferably an external consultant rather than someone within the firm.
- Update for recent changes. Reflect new services, software, AI tools, staff, and your AML/CTF obligations from 1 July 2026.
- Train and record. Brief staff on the manual and keep a record that they've read it.
- Fix and log deficiencies. Record what went wrong, the root cause, and what you changed.
Final thoughts
APES 320 moves firms from checking work after the fact to building quality into how the practice runs. A well-designed system does more than pass a quality review: it makes work more consistent, reduces rework, reduces the likelihood of litigation, protects brand reputation and gives clients more confidence in your firm.
If you need help, Quality Assurance for Accountants prepares APES 320, ASQM 1 and APES 325 manuals and gives independent pre-review advice.
Our principal, Craig Allen, is a former CPA Australia quality assurance reviewer who has helped more than 800 accounting practices across Australia successfully complete quality reviews.