Risk, Experience and Client Acceptance Decisions

ational Public Accountant, Vol. 46, No. 5, pp. 27-38, July 2001

4 Pages Posted: 4 Oct 2006

See all articles by Karla M. Zehms

Karla M. Zehms

University of Wisconsin - Madison - Department of Accounting and Information Systems

Abstract

Risk containment efforts are one of the most important activities of public accounting firms in today's litigious and highly competitive environment. Of these efforts, the first "line of defense" is the decision to accept a client. By effectively screening out risky potential clients, firms can guard against the risk of litigation. Despite its growing importance, little is known about how auditors make this decision. Professional standards state that firms should establish procedures for making the client acceptance decision and should "appropriately consider the risks associated with providing professional services in the particular circumstances." However, no guidance is provided about factors that should be considered in making the decision.

Suggested Citation

Zehms, Karla M., Risk, Experience and Client Acceptance Decisions. ational Public Accountant, Vol. 46, No. 5, pp. 27-38, July 2001. Available at SSRN: https://ssrn.com/abstract=934172

Karla M. Zehms (Contact Author)

University of Wisconsin - Madison - Department of Accounting and Information Systems ( email )

School of Business
975 University Avenue
Madison, WI 53706
United States
608-234-1052 (Phone)
608-265-5031 (Fax)

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