In Assessing Whether to Accept a Client for an Audit

question 58

Multiple Choice

In assessing whether to accept a client for an audit engagement,a CPA should consider

• A) The current financial health of the prospective client.
• B) The integrity of management.
• C) The CPA's overall engagement risk.
• D) All of these should be considered.

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Definitions:

Simon Kuznets

An economist known for his work on economic growth and for formulating the concept of Gross Domestic Product (GDP) as a measure of national income.

Economic Growth

An increase in the production of goods and services in an economy, typically measured by GDP.

Quality of Resources

The effectiveness, efficiency, and skills of economic resources, including labor, capital, and natural resources.

Labor Productivity

An indicator of economic efficiency that assesses the quantity of goods and services generated for each labor hour.