Ch. 3 Client Acceptance

Question 1

Technical competencies: Assess issues related to the undertaking of the engagement or project

Answer 1

Technical competencies: Assess issues related to the undertaking of the engagement or project

Question 2

What is CAS 220?

Answer 2

CAS 220 offers guidance for quality control for an audit of financial statements including guidance for accepting or continuing audits

Question 3

What characteristics of a client would you need to consider per CAS?

Answer 3

• Integrity of the principal owners, key management, and those charged with governance
• Whether the engagement team is competent
• significant matters that have arisen in the current or previous engagement
• whether the team can act ethically with independence
• willingness of the client to cooperate
• risk response of the client
• reason for the client to switch auditors

Question 4

What is CAS 210?

Answer 4

Specifics that new clients or an existing client should not be accepted unless required by law to do so if management fails to acknowledge its responsibility in writing, or choose a financial reporting framework that is not accepted.

Question 5

What does an engagement letter include?

Answer 5

Objective, scope, responsibility of both parties, identification of the applicable framework, reference to the expected form and basis of which fees are computed and any billing arrangements.