The Defendant-Auditors in the Anjoorian Case Argued, in Their Defense

question 20

Multiple Choice

The defendant-auditors in the Anjoorian case argued, in their defense, that:

• A) To be found guilty to third parties, the court must find that an accountant had contemplated a specific transaction for which the financial statement will be used and that no such transaction was contemplated.
• B) The plaintiff's theory of damages did not meet the foreseen legal criteria
• C) They had no liability to the client because the client did not rely on the audited financial statements
• D) They followed generally accepted auditing standards

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Definitions:

Serial Bond

A bond issue that matures in installments over a period rather than having a single maturity date.

Contract Rate

The agreed-upon rate or price specified in a contract for the provision of goods or services.

Effective Rate

The actual interest rate realized on an investment, taking into account the effect of compounding over a given time period.

Bond Premium

The surplus value of a bond beyond its principal amount when sold in the market.