Multiple Choice Questions
The following questions pertain to client acceptance. Choose the best response.
a. In assessing whether to accept a client for an audit engagement, a CPA should consider

b. When approached to perform an audit for the first time, the CPA should make inquiries of the predecessor auditor. This is a necessary procedure because the predecessor may be able to provide the successor with information that will assist the successor in determining whether
(1) The predecessor's work should be used.
(2) The company follows the policy of rotating its auditors.
(3) In the predecessor's opinion internal control of the company has been satisfactory.
(4) The engagement should be accepted.
c. A successor would most likely make specific inquiries of the predecessor auditor regarding
(1) Specialized accounting principles of the client's industry.
(2) The competency of the client's internal audit staff.
(3) The uncertainty inherent in applying sampling procedures.
(4) Disagreements with management as to auditingprocedures.

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Client Business Risk Yes Yes No No Acceptable Audit Risk Yes No Yes No