Auditor Appointment

Question 1

What should the auditor’s response be after being asked to commence the audit of a potential firm?

Answer 1

Contact the previous auditors for professional clearance before starting the audit.

Question 2

Components of an audit engagement letter

Answer 2

1. Objective and scope of audit
2. Management’s responsibilities

Question 3

What is and is not necessary in a client screening process?

Answer 3

IS:
1. Internal controls
2. Integrity
3. Conflict of interest
NOT:
1. Background check

Question 4

Situations that are appropriate to remind the client of the existing audit terms or revise them?

Answer 4

1. Client opened new branch oversees
2. Change in senior mgt
3. New regulations

Question 5

Reasonable transfer information from previous auditor to the new?

Answer 5

1. Detailed trial balance of FS
2. Copy of FS approved by old auditor

Answer 6

Listed Companies.