After his auditing class at a local state university, James stops by to see the professor during his office hours. James asks the professor

to elaborate a little more on and provide an overview of the management representation letter. Which of the following is the

professors' best response to this query?

The best way to understand the management representation letter is to think of it as management's communication to the

auditors acknowledging responsibility for the financial statements.

The management representation letter is typically sent to the client's management by the auditing firm towards the end of

the attestation engagement. It details all recommendations the audit firm to amend the financial statements and thus

decrease liability.

Perhaps the best way to conceptualize the management representation letter and the purpose behind sending it is to ensure

that management makes the auditors fully aware of any and all issue that may cause future litigation for the client and$/$or

the auditor. The audit firm cannot be held liable if this letter is not sent.

The easiest way to think about the management representation letter is to think of it as a mechanism by which the audit firm

can absolve itself of any liability associated with the audit.

Tommy and Melissa are working on the audit of High Point Enterprises, a national supplier of lawn irrigation systems. This audit is

Tommy's first audit, and he has asked Melissa to explain how auditors typically communicate with the client's management. Which of

the following represents Melissa's most appropriate response?

It is generally customary for the auditors to communicate with the client's management toward the end of the audit. At this

point, we're usually in a position to communicate the audit findings and what opinion we expect to give on the client's

financial statements.

The auditors routinely communicate with the client's senior management at various points throughout the audit. Most of

the communication occurs at the beginning of the audit, as the audit partners and senior management agree on the nature,

timing and extent of audit procedures.

The auditors communicate with the client's management at different points of the audit. For example, the auditors will

likely send an engagement letter at the beginning of the audit, and will communicate audit findings to management during

the audit itself.

None of these answer choices are correct.