Prior to the acceptance of an audit engagement with a client who has terminated the services of the previous auditor, the proposed auditor should:
A) contact the previous auditor without advising the prospective client and request a complete report of the
Circumstances leading to the termination with the understanding that all information disclosed will be kept confidential.
B) accept the engagement without contacting the previous auditor, since the proposed auditor can include audit procedures to verify the reason given by the client for the termination.
C) not communicate with the previous auditor, because this would in effect be asking the auditor to violate the confidential relationship between auditor and client.
D) advise the client of the intention to contact the previous auditor and request permission for the contact.

Question

Quizplus · Accepted Answer

It is important for the proposed auditor to contact the previous auditor in order to obtain relevant information about the client and the circumstances leading to the termination of the previous audit engagement. This can help the proposed auditor assess the risks associated with the client and determine if there are any issues that need to be addressed before accepting the engagement. However, prior permission from the client should be obtained before making any contact with the previous auditor. This is important to maintain the confidentiality between the proposed auditor and the client.

Prior to the Acceptance of an Audit Engagement with a Client