Before Accepting an Engagement to Audit a New Entity,an Auditor

question 15

Multiple Choice

Before accepting an engagement to audit a new entity,an auditor is required to

• A) Make inquiries of the predecessor auditor.
• B) Tell the company whether or not the auditor is willing to issue a "clean" opinion.
• C) Prepare a memorandum setting forth the staffing requirements and documenting the preliminary audit plan.
• D) Become a member of the entity's board of directors.

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Definitions:

Super-Event Probability

An estimation of the likelihood of a composite event, taking into account the probabilities of multiple subordinate events.

Simultaneously

Occurring, operating, or done at the same time.

Disaster Risk

The potential loss or damage that could occur as a result of a disaster event, taking into account both the hazard and the vulnerability of the affected area.

Financial Loss

The condition of having less money or resources at the end of a period than at the beginning, typically as a result of expenses exceeding income.