Final answer:
The Credit Alliance Corp. v. Arthur Andersen & Co court case highlighted the significance of engagement letters in defining an auditor's liability.
Step-by-step explanation:
The court case highlighting the need for attaining engagement letters is B) Credit Alliance Corp. v. Arthur Andersen & Co. This case set a precedent on the extent of an auditor's liability to third parties concerning negligence. The court concluded that there needed to be evidence of a relationship approaching privity between the auditor and the third party for liability to arise. Engagement letters became highly recommended as they help define the scope of an auditor's responsibilities and form a contractual link between the auditor and the client, which can potentially limit the auditor's liability to third parties.