A CA May Be Liable to Any Purchaser of a Security

question 15

Multiple Choice

A CA may be liable to any purchaser of a security if the CA issued a clean opinion on materially misstated financial statements.CA usually will not be liable to the purchaser

• A)If the purchaser is guilty of contributory negligence.
• B)If the CA can prove due care in the audit.
• C)Unless the purchaser can prove privity with the CA.
• D)Unless the purchaser can prove scienter on the part of the CA.

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Definitions:

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