Which of the Following Actions Is the Most Likely First

question 43

Multiple Choice

Which of the following actions is the most likely first step that an auditor will perform after accepting an initial audit engagement?

• A)Prepare a rough draft of the financial report and the auditor's report.
• B)Assess control risk for the assertions embodied in the financial report.
• C)Tour the client's facilities and review the general records.
• D)Consult with and review the work of the previous auditor prior to discussing the engagement with the client management.

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Definitions:

Bonus

An additional compensation given to employees as a reward for achieving targets or exceptional performance.

Incoming Partner

An individual who is joining an existing partnership, bringing capital, skills, or other resources into the business in exchange for a share of the profits and losses.

Partnership Books

Financial records and accounts specifically maintained to track the transactions and financial state of a partnership.

Capital Account

A financial statement that shows the changes in a company's equity during a specific period.