What is the best description of the engagement letter?
A)The letter soliciting a potential client.
B)A letter from a successor auditor to a predecessor auditor asking to review the working papers for the previous year.
C)The audit contract,which may include special requests.
D)The letter at the end of the audit engagement reviewing any concerns the auditors wish management to be aware of.

Question

Quizplus · Accepted Answer

The engagement letter is the contract between the auditor and the client outlining the scope of the audit, fees, and other terms and conditions. It may also include any special requests or considerations requested by the client.

Answer: D
 The letter at the end of the audit engagement is the management letter which outlines any concerns or recommendations the auditors have for the client. It is not the engagement letter.

What Is the Best Description of the Engagement Letter