Ronald Is an Independent Accountant

question 67

Multiple Choice

Ronald is an independent accountant.He is hired by Procious,Inc.to audit its financial statements.He fails to uncover that Procious,Inc.has been involved in embezzlement.A corporation makes a tender offer for the shares of Procious,Inc.and discovers the embezzlement.According to which of the following standards is Ronald liable for negligence?

• A) the Ultramares doctrine
• B) Section 552 of the Restatement (Second) of Torts
• C) the foreseeability standard
• D) implied warranty of fitness for a particular purpose

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Definitions:

Immigration

The action of coming to live permanently in a foreign country.

Opportunity Cost

The expense incurred by not choosing the second-best option while making a decision.

Labor Decreases

A situation where the workforce or the amount of work done decreases due to factors like automation, layoffs, or economic downturns.

Retain Earnings

Profits that a company keeps after dividends have been paid out to shareholders, often used for reinvestment in the business.