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Managing the Risks of Client Acceptance and Continuance

The CPA Journal

January 2020

Tom Manisero (Partner-White Plains) contributed comments to a recent article in The CPA Journal on "Managing the Risks of Client Acceptance and Continuance." Describing an engagement where a partner with the requisite experience to lead the audit became disabled and, rather than disengage from the client, the firm appointed another engagement partner who was not as qualified. "Finally, succumbing to the pressure of the client to complete the audit, the firm issued a clean opinion," said Tom. "A short while later, the client was publicly exposed for having operated a fraud. The experience had dire consequences for the firm." Tom believes it is a client continuance best practice to constantly evaluate how clients are performing financially, and whether the firm is capable of completing the engagement. "Are there financial stresses? Have there been changes in the client's personal or business circumstances that change the nature of the client? Staying in touch with and understanding the client, no matter what the nature of the engagement, is the best way to determine if there is elevated risk in continuing to service the client."

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