Smith & Jones Rendered an Unmodified Auditor's Opinion on the Financial

question 8

Multiple Choice

Smith & Jones rendered an unmodified auditor's opinion on the financial report of a company that sold shares in a public offering. Based on a false statement in the financial report, Smith & Jones is being sued by an investor
Who purchased shares in this public offering. Which of the following represents a viable defence?

• A) The investor has not met the burden of proving fraud or negligence by Smith & Jones.
• B) The false statement is immaterial in the overall context of the financial report.
• C) Detection of the false statement by Smith & Jones occurred after the date of the auditor's report.
• D) The investor did not actually rely upon the false statement.

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Definitions:

Inorganic Carbons

Carbon compounds that do not contain carbon-hydrogen bonds, typically excluding those found in living organisms or their remains.

Nitrogen-Fixing Bacteria

Bacteria capable of converting atmospheric nitrogen into ammonia, making nitrogen available to plants for growth.

T. Aquaticus

A species of bacterium that thrives in hot environments and is a source of Taq polymerase, a key enzyme in PCR (polymerase chain reaction) technology.

Agrobacterium

A genus of bacteria known for its ability to transfer DNA to plant cells, widely used in genetic engineering to introduce new genes into plant genomes.