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Dodd, CPA, audited Adams Company's financial statements

Dodd, CPA, audited Adams Company's financial statements for the year ended December 31, 20X8. On November 1, 20X9 Adams notified Dodd that it was changing auditors and that Dodd's services were being terminated.On November 5, 20X9, Adams invited Hall, CPA, to make a proposal for an engagement to audit its financial statements for the year ended December 31, 20X9.

What procedures concerning Dodd should Hall perform before accepting the engagement?

What additional procedures should Hall consider performing during the planning phase of this audit (after acceptance of the engagement) that would not be performed during the audit of a continuing client?

Solution Preview

Dodd, CPA, audited Adams Company's financial statements for the year ended December 31, 20X8. On November 1, 20X9 Adams notified Dodd that it was changing auditors and that Dodd's services were being terminated.On November 5, 20X9, Adams invited Hall, CPA, to make a proposal for an engagement to audit its financial statements for the year ended December 31, 20X9.

What procedures concerning Dodd should Hall perform before accepting the engagement?

What additional procedures should Hall consider performing during the planning phase of this audit (after acceptance of the engagement) that would not be performed during the audit of a continuing client?
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Solution:

a. The procedures Hall should perform before accepting the engagement ...

Solution Summary

Dodd, CPA, audited Adams Company's financial statements for the year ended December 31, 20X8. On November 1, 20X9 Adams notified Dodd that it was changing auditors and that Dodd's services were being terminated.On November 5, 20X9, Adams invited Hall, CPA, to make a proposal for an engagement to audit its financial statements for the year ended December 31, 20X9.

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