Auditors are permitted to perform for a contingent fee an audit of the financial statements if the audit committee approves the agreement in advance of the services being provided.

Question

Quizplus · Accepted Answer

Auditors are not permitted to perform an audit of the financial statements for a contingent fee, regardless of the approval of the audit committee. This is a violation of the independence rules outlined by the SEC and various accounting organizations.

Auditors Are Permitted to Perform for a Contingent Fee an Audit