An Investor Suing an Auditor for Not Discovering That the Financial

question 22

Multiple Choice

An investor suing an auditor for not discovering that the financial statements of a company were materially misstated is an example of

• A)criminal liability.
• B)fiduciary duty.
• C)third party liability.
• D)liability to client under common law.

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Definitions:

Lawrence Kohlberg

A psychologist known for his theory of stages of moral development, which outlines how people evolve in their ethical reasoning.

Moral Reasoning

The process by which individuals make decisions about what is right and wrong based on personal, societal, and ethical criteria.

Prejudice

An unjustified or incorrect attitude (usually negative) towards an individual based solely on the individual's membership in a social group.

Discrimination

Unjust or prejudicial treatment of different categories of people, especially on the grounds of race, age, sex, or disability.