Question

Which of the following normally signs the engagement letter for an audit of a private company?

A) Management
B) Board of directors representative
C) Audit committee representative
D) Corporate treasurer

Answer 1

The engagement letter for a private company's audit is usually signed by a representative of the Board of Directors, in line with their oversight and corporate governance role.

Step-by-step explanation:

The individual normally responsible for signing the engagement letter for an audit of a private company is a representative of the Board of Directors. The board, being elected by the shareholders, is the primary body responsible for corporate governance and oversight of the company's executives. Thus, in corporate governance, the auditing firm engaged to scrutinize the financial records and an audit committee representative typically part of the board structure are integral parts of ensuring that a firm's operations are transparent and that financial statements are presented fairly.