When a CPA Is Approached to Perform an Audit for the First

question 68

Multiple Choice

When a CPA is approached to perform an audit for the first time,the CPA should make inquiries of the predecessor auditor.This is a necessary procedure because the predecessor may be able to provide the successor with information that will assist the successor in determining

• A) Whether the predecessor's work should be utilized.
• B) Whether, in the predecessor's opinion, the financial statements are materially correct.
• C) Whether, in the predecessor's opinion, the company's internal controls have been satisfactory.
• D) Whether the engagement should be accepted.

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Definitions:

Trademarks

Icons, titles, or expressions that are legally recognized or adopted through usage to signify a corporation or merchandise.

Licensing

The act of granting official permission to use intellectual property, perform specific activities, or operate legally under defined conditions.

Sole Proprietorship

A business structure where a single individual owns and runs the business, enjoying full control and responsibility for its debts and liabilities.

Partnership

A lawful business structure involving two or more people who manage and profit together.