Sigma Ltd. has approached CJK & Associates to appoint them as their auditor for a period of 5 years in accordance with provisions of the…

A firm before accepting an engagement should acquire vital information about the client. Such an information should help firm to decide about: Integrity of ClientCompetence (including capabilities, time and resources) to perform engagementCompliance with ethical requirements With regard to the integrity of a client, matters that the firm considers include, for example: The identity and business reputation of the client's principal owners, key management, related parties and those charged with its governance.The nature of the client's operations, including its business practices.Information concerning the attitude of the client's principal owners, key management and those charged with its governance towards such matters as aggressive interpretation of accounting standards and the internal control environment.Whether the client is aggressively concerned with maintaining the firm's fees as low as possible.Indications of an inappropriate limitation in the scope of work.Indications that the client might be involved in money laundering or other criminal activities.The reasons for the proposed appointment of the firm and non-reappointment of the previous firm.