In auditing the financial statements of Star Corp., Land discovered information leading Land to believe that Star’s prior-year financial statements, which were audited by Tell, require substantial revisions. Under these circumstances, Land should
Request Star to arrange a meeting among the three parties to resolve the matter.
Because the prior year’s financial statements appear to require restatement, the auditor should discuss the matter with the predecessor auditor. (S)he should communicate any information that the predecessor auditor may need to meet the responsibilities imposed by AU-C 560, Subsequent Events and Subsequently Discovered Facts. A meeting of the three parties should be requested.