Under the Securities Act of 1933, a Third-Party Plaintiff Does

question 44

True/False

Under the Securities Act of 1933, a third-party plaintiff does not have the burden of proof that he or she relied on the financial statements or that the auditor was negligent or fraudulent in doing the audit. Rather, the plaintiff need only prove that the audited financial statements contained a material misrepresentation or omission.

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Definitions:

Long-Term Memory

The phase of the memory process that allows the storage of information over extended periods, potentially lifelong.

Recall

The cognitive process of retrieving past information or experiences from memory without the aid of explicit cues.

Errors

Mistakes or inaccuracies in action, calculation, opinion, or judgment caused by poor reasoning, carelessness, or insufficient knowledge.

Working Memory

A brain function of limited capability designed to hold information in the short term for later processing.