An Audit Firm's Quality Control Procedures Pertaining to the Acceptance

question 19

Multiple Choice

An audit firm's quality control procedures pertaining to the acceptance of a prospective audit client would most likely include:

• A)enquiry of management as to whether disagreements between the previous auditor and the prospective client were resolved satisfactorily.
• B)confirmation of the prospective client's bank accounts.
• C)enquiry of third parties, such as the prospective client's bankers and solicitors, about information regarding the prospective client and its management.
• D)consideration of whether the internal control is sufficiently effective to permit a reduction in the extent of required substantive tests.

---

Definitions:

Telephone Consumer Protection Act of 1991

A federal law that restricts telemarketing calls, the use of automated telephone equipment, and other forms of telephone-based marketing.

Prerecorded Voice

Involves automated messages delivered via telephone without the need for a live speaker.

Automatic Telephone Dialing System

Technology that can dial numbers without human intervention, often used in telemarketing.

Truth-in-Lending Act

U.S. federal law designed to promote transparency in consumer credit by requiring lenders to disclose important terms and costs of loans to borrowers.