A CPA has received an attorney's letter in which no significant disagreements with the client's assessments of contingent liabilities

were noted. The resignation of the client's lawyer shortly after receipt of the letter should alert the auditor that

The auditor must begin a completely new examination of contingent liabilities.

Undisclosed unasserted claims may have arisen.

The attorney was unable to form a conclusion with respect to the significance of litigation, claims, and assessments.

An adverse opinion will be necessary.