Which of the following is a necessary precondition for a practitioner to undertake an assurance engagement to examine and report on an entity's internal control over financial reporting?
A)Management presents its written assertion about the effectiveness of internal control.
B)The practitioner anticipates relying on the entity's internal control in a financial report audit.
C)Management agrees not to present the practitioner's report in a general-use document to shareholders.
D)The practitioner is a continuing auditor who previously has audited the entity's financial report.

Question

Quizplus · Accepted Answer

Management's written assertion about the effectiveness of internal control is a necessary precondition for the practitioner to undertake an assurance engagement to examine and report on an entity's internal control over financial reporting, as it provides the basis for the engagement and sets the criteria against which the practitioner's findings are evaluated. Choice B may be a reason for undertaking the engagement, but it is not a necessary precondition. Choice C is not relevant to the engagement itself but may be a matter of agreement between management and the practitioner. Choice D is not a necessary precondition unless the engagement is part of the continuing audit engagement.

Which of the Following Is a Necessary Precondition for a Practitioner