Chapter 5 Client Acceptance
Client acceptance phase objectives • Examination of the proposed client to determine if there is any reason to reject the engagement (acceptance OF the client) and convincing the client to hire the auditor (acceptance BY the client) • Decide on acquiring a new client or continuation of the relationship with an existing client • Determine the type and amount of staff.
Client acceptance procedures • Evaluate the client’s background and reasons for the audit. • Determine whether the auditor is able to meet the ethical requirements regarding the client. • Determine need for other professionals. • Communicate with predecessor auditor (someone who was previously the auditor of an entity and who has been replaced by an incoming auditor). • Prepare client proposal. • Select staff to perform the audit. • Obtain an engagement letter.