(a) In this subtitle the following words have the meanings indicated.
(b) “Engagement review” means a peer review that evaluates whether there is a reasonable basis for expressing limited assurance that:
(1) financial statements with which the individual or firm is associated conform in all material respects with professional standards; and
(2) reports and internal documentation of the work performed by the individual or firm conform with professional standards.
(c) “Fail” means, in connection with a report of a peer reviewer, one or more significant deficiencies in performing or reporting in conformity with professional standards in the individual or the firm being reviewed.
(d) “Peer review” means a study, appraisal, or review of one or more aspects of the professional work of an individual or firm performed by a person licensed as a certified public accountant.
(e) “Report indicating pass with deficiencies” means a report of a peer reviewer that indicates one or more deficiencies in performing or reporting in conformity with professional standards in the individual or firm being reviewed.
(f) “Review” means the analysis of a financial statement that:
(1) is performed in accordance with the Statements on Standards for Accounting and Review Services of the American Institute of Certified Public Accountants; and
(2) provides a licensee with a reasonable basis for expressing limited assurance that there are no material modifications that should be made to the statement in order for it to be in accordance with generally accepted accounting principles, or, if applicable, with any other comprehensive basis of accounting.
(g) “System review” means a peer review evaluating whether there is reasonable assurance that:
(1) the system of quality control of the individual or firm being reviewed is designed and operated in such a manner as to meet professional standards;
(2) financial statements with which the licensee or firm is associated conform in all material respects with professional standards; and
(3) reports and internal documentation of the work performed by the licensee or firm conform with professional standards.