An Accountant Who Is Being Sued by a Third Person

question 25

Multiple Choice

An accountant who is being sued by a third person for malpractice based on fraud will be able to avoid liability if the accountant can show:

• A) contributory negligence on the part of the plaintiff.
• B) that an exculpatory clause applies.
• C) that the plaintiff did not rely on the false statement.
• D) the absence of privity of contract.

---

Definitions:

Recover Damages

The act of obtaining compensation through legal means for loss or injury.

Licensee

An individual or entity that has been granted permission to engage in an activity or to use property owned by another, typically through a licensing agreement.

Church Services

Ceremonies or worship sessions conducted by a Christian congregation or denomination.

Door-to-Door

A sales or marketing tactic where products or services are offered by going directly to the homes or businesses of potential customers.