6 Questions
What is the first step in initial audit planning?
Deciding whether to accept a new client or continue serving an existing one
What is the reason why some CPA firms refuse clients in high-risk industries?
They pose a risk of litigation
Why is it important for the auditor to make a decision on accepting a new client or continuing with an existing one early?
To avoid incurring significant costs that cannot be recovered
What must a CPA firm investigate before accepting a prospective client?
All of the above
What is the purpose of obtaining an understanding with the client about the terms of the engagement?
To avoid misunderstandings with the client
What must successor auditors do for prospective clients that have previously been audited?
Communicate with predecessor auditors
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