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You are happy to learn that Ceber Asia Ltd., a Hong Kong listed company, proposes if appoint you as their auditor for the coming year. You tell Ceber's Chairman that before accepting the engagement you must contact Ceber's existing auditor to determine f there are any professional reasons why you should not accept the engagement. The existing auditor's response letter indicates that there was a dispute between the auditor and the Chairman in the wording of the annual report. In the auditor's opinion the Chairman was very selective in the financial information that was summarized in the Chairman's Report to shareholders. You call the Chairman to discuss these matters. He states that he has never been contacted by the existing auditor since the dispute was resolved by the audit committee and is surprised by the existing auditor's comment. Discussion a. What steps should you take prior to accepting the audit engagement? b. What is the ethical problem with the letter you received from the existing auditor? What should you do