Before Accepting an Engagement to Audit a New Client, a CPA

question 32

Multiple Choice

Before accepting an engagement to audit a new client, a CPA is required to obtain:

• A)an understanding of the prospective client's industry and business.
• B)the prospective client's signature on the engagement letter.
• C)a preliminary understanding of the prospective client's control environment.
• D)the prospective client's consent to make inquiries of the predecessor auditor.

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Definitions:

Ending

The process of bringing an activity or condition to a conclusion or cessation.

Evaluating

The process of assessing or judging the quality, importance, or value of something.

Five-Stage View of Change

A conceptual framework suggesting that change occurs in five distinct stages: precontemplation, contemplation, preparation, action, and maintenance.

Rogers

Refers to Carl R. Rogers, an influential American psychologist known for his contributions to humanistic psychology and the client-centered approach.