The Primary Reason an Auditor Requests Letters of Inquiry Be

question 307

Multiple Choice

The primary reason an auditor requests letters of inquiry be sent to a client's attorneys is to provide the auditor with:

• A) The probable outcome of asserted claims and pending or threatened litigation.
• B) Corroboration of the information furnished by management about litigation, claims, and assessments.
• C) The attorneys' opinions of the client's historical experiences in recent similar litigation.
• D) A description and evaluation of litigation, claims, and assessments that existed at the balance sheet date.

---

Definitions:

Salary

A fixed regular payment, usually expressed as an annual sum, made by an employer to an employee, especially a professional or white-collar worker.

Economic Forecasts

Predictions about future economic activity, including growth rates, inflation, and labor market conditions, based on current and historical data.

In-kind Transfer

In-kind transfers are non-cash distributions of goods or services from governments or organizations to individuals, aimed at assisting with basic needs such as food and housing.

Welfare Payments

Financial assistance provided by a government to individuals in need.