Reissues, Engagement Letters, ADR and Unpaid Fees

Question 1

What are reissued reports?

Answer 1

Auditors may reissue a report by reference, even if no longer independent, as long as updating the date isn’t required

Question 2

What is an engagement contractual term?

Answer 2

For an engagement letter to require an attest client to indemnify or hold harmless a member firm for liability and costs resulting from knowing misrepresentations by the client’s management.

Question 3

What does Alternative Dispute Resolution mean?

Answer 3

The use of methods such as mediation and arbitration to resolve a dispute instead of litigation

Question 4

______________ may require use of ADR to resolve disagreement with clients

Answer 4

Engagement Letter

Question 5

If ADR is initiated….

Answer 5

It will place MIPPs and the client in positions of material adverse interests and thereby impair independence so the conceptual framework should be applied

Question 6

What are unpaid bills?

Answer 6

1 Invoices not billed
2 Notes issued for payment
3 Exception to clients in bankruptcy

Question 7

Rule for MIPPs with clients who have unpaid bills?

Answer 7

MIPPs may not sign a current year audit if it has unpaid fee of more than one year