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Policies-Acceptance and Continuance of Clients and Engagements

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                              Evaluation of Engagement
Policy Statement: 
The CPA firm will examine carefully the engagement to see if it can be completed with professional competence and will begin only those that can be completed with professional competence and will weigh the risk of each.                                                                                                                            Implementation: The CPA firm will carry out this policy through the following procedures: 

A)    Examining carefully whether the CPA firm acquired or expect to acquire the knowledge and expertise needed for it to perform the engagement

1.      Use subcontractors when needed such as Appraisers, architects, etc. 

2.      Use of CPE courses and Internet searches on related subjects.

3.      Study the Industry and Client Research, to get to know the business before client acceptance or retention ever takes place.  This allows our staff the time to be familiar with the issues facing the industry and the client specifically before actually setting foot in a client's financial facility or headquarters.  This activity is on going through out the relationship.

B)     Set up a requirement or criteria and examine it carefully for a client or engagement, getting pertinent data to decide if a client should be dropped, and to set a due date for this examination. The criteria includes the following:

1.      Change in client situation (ownership, its business, or its financial stability.)

2.      Nature or scope of the engagement changes, (need for more services.)

3.      CPA firm changes (inability to replace the loss of key personnel)

4.      Present criteria, if known before would cause the client to be dropped. Client delinquent in paying fees. (This may also affect the firm’s independence.)

5.      Very regulated engagements including financial institutions  

6.      Oppressive engagements many hours required to complete the engagement.

C)    Examining acquired data carefully

1.      The officer of the CPA firm examines every data carefully and a decision is made to keep or drop an engagement or client.                         

2.      The officer completes a client acceptance form 

3.      The officer signs a step in the planning program documenting client continuance is completed if conditions identified above (step 2) exist.

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