An Entity Not in Privity with an Accountant Is Prohibited

question 32

True/False

An entity not in privity with an accountant is prohibited from recovering against the accountant for malpractice when the accountant had no knowledge of any use that could affect the party.

---

Definitions:

Marginal Benefit

The boost in value or pleasure gained from the consumption of one more unit of a good or service.

Supply and Demand

Fundamental economic principles that describe how prices are determined in a market based on the quantity of a good or service available and desired.

Pollution Rights

Permits or allowances that authorize the holder to emit a certain amount of pollution, often tradeable in a market to encourage reduction of pollution in cost-effective ways.