Decide Whether or Not These Statements Are True or False

question 7

Short Answer

Decide whether or not these statements are true or false
a. Auditors owe a duty of care to potential investors in their client
b. Auditors may reduce the consequences of a negligence claim against them by operating as a limited liability partnership
c. In order to prove a successful claim for negligence the client only has to suffer a loss which is the fault of the auditors

---

Definitions:

Investing Section

A part of the cash flow statement that reports the purchase and sale of long-term investments and property, plant, and equipment.

Repayments of Bonds

This concerns the act of returning borrowed funds to bond investors at the agreed-upon maturity date, usually including both principal and interest payments.

Statement of Cash Flows

A financial report that shows the cash inflows and outflows for a company over a specific period, indicating how it sources and uses cash.

Amortization

The process of gradually paying off a debt over a period of time through planned, periodic payments of principal and interest.