When An Audit Engagement Is Accepted By Any Cpa Firm Essay

866 Words Oct 3rd, 2016 4 Pages
Before an audit engagement is accepted by any CPA firm, several considerations should be taken into account. Foremost, an audit firm should carry out a background assessment and review of the client to ensure that the company’s history, nature of its activities, any areas of possible risk and any company information is well documented and analyzed before accepting the engagement. Further, the audit firm should contact the outgoing auditor to investigate any key factors or matters of importance that the new audit firm should be aware of and identify any reasons as to why the outgoing auditor was dismissed. Therefore, lack of response from the Miles Frazer about any pending litigation issues or any other legal matters that the firm should know limits the amount of information that the audit firm gathers regarding to the new client and therefore may lead to denial of accepting any audit engagement. In addition, Jost had side-stepped Corliss’s request for permission to speak with the outgoing auditor until the client was pressured to. According to the principles of auditing professionalism, an auditor with any conflicting interest should not be given any audit engagement with the client since it will impair the auditor’s independence and judgment. But according to Jost, the outgoing auditor has conflicting interest with the client and yet the predecessor auditor had been given the audit engagement. Finally, the independence of the auditors should be maintained at all times. In…

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