Question

Which of the following matters generally is included in an auditor's engagement letter?

A. Management's responsibility for the entity's compliance with laws and regulations.
B. The factors to be considered in setting preliminary judgments about materiality.
C. Management's liability for illegal acts committed by its employees.
D. The auditor's responsibility to guarantee accuracy of the financial statements.

Answer 1

An auditor's engagement letter generally includes management's responsibility for compliance, factors in setting materiality judgments, and the auditor's responsibility for accuracy.

Step-by-step explanation:

An auditor's engagement letter generally includes matters such as management's responsibility for the entity's compliance with laws and regulations, the factors to be considered in setting preliminary judgments about materiality, and the auditor's responsibility to guarantee accuracy of the financial statements.