Which of the Following Statements Is True of Accountants' Liability

question 41

Multiple Choice

Which of the following statements is true of accountants' liability to clients in breach of contract suits?

• A) Courts consider damages to include expenses incurred by the client in securing another accountant to perform the needed services.
• B) Courts usually award punitive damages if the auditor provides a disclaimer of opinion after auditing clients' financial statements.
• C) An accountant who fails to perform the terms specified in an engagement can be sued for damages only if the accountant displayed reckless regard.
• D) Penalties incurred by the client for missed deadlines or lost opportunities are not considered by courts while awarding damages.