Final answer:
A CPA should inquire with the predecessor auditor to assist in determining if there are any issues that might affect their decision to accept an audit engagement, ranging from professional disagreements to potential fraud.
Step-by-step explanation:
When a CPA is approached to perform an audit for the first time, they should make inquiries of the predecessor auditor. This is a necessary procedure because the predecessor may be able to provide the successor with information that will assist the successor in determining whether there are any reasons affecting the willingness or ability to accept the engagement. Issues may include understanding the predecessor auditor's reasons for termination, disagreements with management on accounting policies or procedures, and identification of any fraud or illegal acts that were discovered or suspected. This communication can uncover any professional or ethical issues that might affect the successor's decision to accept the audit engagement and assist with the understanding of the entity and its environment.
When a CPA is approached to perform an audit for the first time, it is necessary to make inquiries of the predecessor auditor. This is because the predecessor may be able to provide the successor with valuable information that will assist in determining various aspects of the audit. For example, the predecessor may share insights about the client's accounting practices, potential risks, or any previous issues encountered during their audit. By gathering this information, the successor can plan and tailor their audit procedures accordingly, ensuring a smooth transition and more effective audit.