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    Question

    An audit engagement letter is primarily issued

    to:
    A The shareholders Correct Answer Incorrect Answer
    B The management of the client Correct Answer Incorrect Answer
    C The stock exchange Correct Answer Incorrect Answer
    D The regulatory authority Correct Answer Incorrect Answer

    Solution

    As per SA 210, the auditor must agree on the terms of the engagement with management or those charged with governance of the client entity, and this agreement is documented in an audit engagement letter addressed to the client management/governance.

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