ACCA AA · Chapter 2 · Question 5 of 10
A firm has been invited to become auditor of Halberd Co. Halberd Co's directors refuse to give the firm permission to contact the outgoing auditor. What should the firm do?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Decline the appointment
Explanation
Before accepting appointment, the proposed auditor should ask the client for permission to contact the outgoing auditor to establish whether there are professional reasons not to accept. If the client refuses permission, the proposed auditor should normally decline the appointment. Contacting the outgoing auditor without permission would breach confidentiality.
More Statutory audit, regulation and corporate governance MCQs
- Q7Under typical company law, which of the following statements about the removal of an auditor is correct?
- Q8Which of the following is NOT normally a responsibility of an audit committee?
- Q9Under good corporate governance practice, which of the following best describes the composition of an audit committee of a listed company?
- Q10Why do corporate governance codes recommend that the roles of chair and chief executive should not be held by the same person?
- Q1Which body issues International Standards on Auditing (ISAs)?