Which of the Following Is Not an Element of a Successful

question 8

Multiple Choice

Which of the following is not an element of a successful negligence action against auditors?

• A)There must be proof that damage resulted.
• B)The plaintiff must be a known user of the financial statements.
• C)There must be a legal duty of care to the plaintiff.
• D)There must be a reasonable connection between the breach of duty of care and resulting losses.

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Definitions:

Personal Assets

Items of value owned by an individual, including both tangible and intangible assets, such as cash, property, investments, and intellectual property.

Insolvent

The condition of being unable to pay off owed debts as they become due.

Total Outstanding Stock

The total shares of a company's stock that are currently owned by all its shareholders, including shares held by institutional investors and restricted shares.

Corporate Form

A legal structure for businesses recognized by law as a separate legal entity with rights, privileges, and liabilities distinct from those of its owners.