a. Request the client's lawyer to evaluate whether the client's pending litigation, claims, and assessments indicate a going concern problem. b. Discuss with management its policies and procedures adopted for evaluating and accounting for litigation, claims, and assessments. c. Examine the legal documents in the client's lawyer's possession concerning litigation, claims, and assessments to which the lawyer has devoted substantive attention. d. Confirm directly with the client's lawyer that all litigation, claims, and assessments have been recorded or disclosed in the financial statements.

a. Request the client's lawyer to evaluate whether the client's pending litigation, claims, and assessments indicate a going concern problem. b. Discuss with management its policies and procedures adopted for evaluating and accounting for litigation, claims, and assessments. c. Examine the legal documents in the client's lawyer's possession concerning litigation, claims, and assessments to which the lawyer has devoted substantive attention. d. Confirm directly with the client's lawyer that all litigation, claims, and assessments have been recorded or disclosed in the financial statements.

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter14: Completing A Quality Audit

Section: Chapter Questions

Problem 7CYBK

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Similar questions

Understand the role of attorney letters in evaluating litigation, claims, and assessments.
What are the responsibilities of (a) client management, (b) auditors, and (c) the client’s attorneyswith respect to obtaining evidence regarding litigation, claims, and assessments?
The primary reason an auditor requests that letters of inquiry be sent to a client's attorney is to provide the auditor with A description and evaluation of litigation, claims, and assessments that existed at the balance sheet date The attorneys' opinions of the client's historical experiences in recent similar litigation, The probable outcome of asserted claims and pending or threatened litigations Corroboration of the information furnished by management about litigation, claims, and assessments
In addition to obtaining responses to attorney letters, what other procedures can be used to gather audit evidence regarding litigation, claims, and assessments?
why should the client represantion letter be prepared foreach examination?
In an attest engagement, the CPA can issue a report on the a. Subject Matter Client’s assertion on the subject matter Yes Yes b. Subject Matter Client’s assertion on the subject matter No No c. Subject Matter Client’s assertion on the subject matter Yes No d. Subject Matter Client’s assertion on the subject matter No Yes
Concerning litigation, claims, and assessments, which of the following is an audit procedure that an auditor Concerning litigation, claims, most likely would perform ? Select one: a. Confirm directly with the client’s lawyer that all litigation, claims, and assessments have been recorded or disclosed in the financial statements. b. Discuss with management its policies and procedures adopted for evaluating and accounting for litigation, claims, and assessments. c. Request the client’s lawyer to evaluate whether the client’s pending litigation, claims, and assessments indicate a going concern problem. d. Examine the legal documents in the client’s lawyer’s possession concerning litigation, claims, and assessments to which the lawyer has devoted substantive attention.
Auditors are required on every engagement to obtain a representation letter from the client. a. What are the objectives of the client’s representation letter? b. Who should prepare and sign the client’s representation letter? c. When should the client’s representation letter be obtained?
when should the client represantion letter be obtained?
What is an auditor’s primary method to corroborate information on litigation, claims, andassessments?a. Examining legal invoices sent by the client’s attorney.b. Verifying attorney–client privilege through interviews.c. Reviewing the response from the client’s lawyer to a letter of audit inquiry.d. Reviewing the written representation letter obtained from management.
In which of the following situations is there a violation of client confidentiality under the AICPA Code of professional conduct? 1. A member discloses confidential client informationto a court in connectionwith arbitration proceedings related to the client. 2.A member disclosesconfidential client informationto a professional liability insurance carrier after learning of a potential claim against the member. 3.A member whose practice is primarily bankruptcy discloses a client's name. 4.A member uses a record retention agency to store clients' records that contain confidential client information.
What is an accountant’s duty of care? What is GAAP and GAAS? Discussion Topic Two: Do some quick internet research and fine a case that deals with an accountant that has been found to have breached the duty of care. Provide a brief summary of the facts of the case, and provide the court's analysis. Be sure to use a reference