Ethical Obligations and Decision-Making in Accounting 2nd Edition by Steven Mintz, Roselyn Morris

Exercise 4

Assume the successor auditor requests permission from a potential client to discuss with the predecessor the reasons and circumstances for the firm’s withdrawal from the engagement. What ethical considerations exist for both the predecessor and successor auditors in pursing the contact? What is the purpose of speaking with the predecessor with respect to planning for the audit and risk assessment?

Step 1 of 3

Audit:

The audit is the process of checking the financial statements of a company `to ensure that it is 100% authentic and free from any kind of bias or fraud.