Choice "A" is correct. Before reissuing a compilation report on the financial statements of a nonissuer for the prior year, the predecessor accountant is required to compare the prior year's financial statements with those of the current year.
Choice "d" is incorrect. Before reissuing a compilation report on the financial statements of a nonissuer for the prior year, the predecessor accountant should obtain a letter from the successor accountants. An updated management representation letter is not required.
Choice "b" is incorrect. The predecessor accountant is not required to review the successor accountant's working papers, especially since it is unlikely that the current year documentation includes information relevant to the previous year's financial statements.
Choice "c" is incorrect. The predecessor accountant is not required to make inquiries of the entity's lawyers concerning continuing litigation.