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5 matters which auditors must consider before accepting new audit engagement.

Unlike in other types of business, when the client needs the services of an audit firm he must approach the firm either directly or through the tendering process. Audit firm in order to make sure that it will be able to provide the high-quality services and be able to get profit from the engagement it must make sure that it assess the client and assess its capability to undertake the engagement.
Before an auditor accepts the new audit, he must consider the following matters: Capability; he must consider if the firm has the capability and resources to carry out the audit. to determine this the auditor will need to consider:

  • The size, location, and level of business of the prospective client
  • The number and level of experience of audit staff required
  • The current commitment of the firm
  • The firm experienced in the audit of such a business.


The auditor must ensure that no circumstance that will constitute a threat to the independence of the firm in carrying out the audit engagement compliance with the rules of change of audit engagement when there is a change of audit engagement
Where there is a change of audit engagement, the incoming auditor before accepting the assignment must observe the rules guiding the change as pronounced by ISA 210

Risk exposure

In accepting new audit engagement, the auditor must consider both the external and internal risk factors. This will enable him to determine the level of risk exposure which he will face in taking up the assignment.

Compliance with statutory and regulatory requirements.

In taking up new audit engagement the auditor must consider If there is any threat to compliance with fundamental accounting standards, guidelines, procedures, and Statutory requirements


In taking up new audit engagement, the auditor must ensure that the firm will be free from intimidation threat, familiarity threat, integrity threat, and self-interest threat

Potential client

The auditor needs to investigate or access the potential client as to the owners, the management and the type and legality of the business to be audited. He could undertake a due diligence test on the company.

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