In the investigation of a potential new client, if the client refuses to give permission to inquire of the predecessor auditor, or if the predecessor does not respond fully, the successor auditor should:
A) consider the implications in making the accept/reject decision.
B) not accept the engagement.
C) request an AICPA-sanctioned peer review of the predecessor.
D) request assistance from the SEC.
E) immediately inform the appropriate state board of accountancy.

Question

Quizplus · Accepted Answer

Considering the implications of a client's refusal to allow inquiry of the predecessor auditor or a predecessor's non-response is crucial in assessing the risks associated with accepting the engagement. This step is part of due diligence and helps in making an informed decision about whether to proceed with the new client.

In the Investigation of a Potential New Client, If the Client