[Anonymous]

The members of the audit team, including the auditor with final responsibility for the audit, should discuss:

A.

the susceptibility of the entity’s financial statements to material misstatement.

B.

staff suggestions concerning the establishment and maintenance of time budgets.

C.

the need for using the work of specialists and internal auditors.

D.

how to document staff disagreements regarding technical issues.

Answer A. An engagement team discussion with the audit team is primarily to give guidance to the staff regarding the susceptibility of the entity’s financial statements to material misstatement. This conference is the first step in the supervision of the audit—instructing and directing assistants in the performance of the fieldwork.

Staff suggestions concerning time budgets are discussed, and the need for using the work of specialists and internal auditors is established during the audit planning. Staff disagreements regarding technical issues are discussed, documented, and resolved when such disagreements arise during the course of the fieldwork.

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The question didn’t specify when exactly the auditors should be discussing what. It just asked what they should be discussing without referring to a specific time period, in which case shouldn’t it be all of the above?

[KBinMN]

These questions used to piss me off sooooooo bad.

I think “A” is the most correct answer, because that is the main concern in a planning type meeting before an audit. Which is probably what the question is alluding to.

That probably isn't great help, but I do think the question sucks. Not unlike most CPA test questions. You just have to know how to give the answer they are looking for.

[Author]

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