The New Audit Client Acceptance Decision 1 
1.0 Introduction
This assessment required students to take the role of an audit manager that is currently employed with Deep Breath LCC, a medium sized national accounting firm. This particular firm offers auditing services as well as tax services. The main purpose of my role as the audit manager is to decide and justify reasons on a new audit client acceptance. The process of accepting a new client is not a simple procedure especially during this phase where the public accounting environment is changing drastically. Intense competitive pressures among audit firms in selecting the best clients and increased exposures of litigation have driven auditors to be more prudent in the process of making decisions when accepting a new audit client. (James, 2012). Therefore, the procedures and factors of considering new prospective clients must be done thoroughly in compliance of the Auditing Standards and the Code of Professional Conduct.
2.0 Purpose of External Auditing
External auditing is essential to provide verification that the annual accounts by the firm provides a true and fair impression of the finances involved in the particular organization, ensuring that preparation of financial statements abide to the International Accounting Standards and other relevant accounting policies. The auditing is done by external auditors who are objective, independent and are knowledgeable to conduct an in-depth investigation to ensure that the financial statements are free from material forgeries and misstatements. External auditing is important as it ensures compliances, provides credibility, double checks internal audit and critique internal processes to enable improvement. (Jack, 2009)
3.0 Company Introduction
Deep Breath LLC believes an engagement of a public limited company such as PETRONAS Gas Berhad that is also registered in Bursa Malaysia would present an excellent opportunity to enter a new market. Before committing to a client, a basic study of certain
This assessment required students to take the role of an audit manager that is currently employed with Deep Breath LCC, a medium sized national accounting firm. This particular firm offers auditing services as well as tax services. The main purpose of my role as the audit manager is to decide and justify reasons on a new audit client acceptance. The process of accepting a new client is not a simple procedure especially during this phase where the public accounting environment is changing drastically. Intense competitive pressures among audit firms in selecting the best clients and increased exposures of litigation have driven auditors to be more prudent in the process of making decisions when accepting a new audit client. (James, 2012). Therefore, the procedures and factors of considering new prospective clients must be done thoroughly in compliance of the Auditing Standards and the Code of Professional Conduct.
2.0 Purpose of External Auditing
External auditing is essential to provide verification that the annual accounts by the firm provides a true and fair impression of the finances involved in the particular organization, ensuring that preparation of financial statements abide to the International Accounting Standards and other relevant accounting policies. The auditing is done by external auditors who are objective, independent and are knowledgeable to conduct an in-depth investigation to ensure that the financial statements are free from material forgeries and misstatements. External auditing is important as it ensures compliances, provides credibility, double checks internal audit and critique internal processes to enable improvement. (Jack, 2009)
3.0 Company Introduction
Deep Breath LLC believes an engagement of a public limited company such as PETRONAS Gas Berhad that is also registered in Bursa Malaysia would present an excellent opportunity to enter a new market. Before committing to a client, a basic study of certain