Which of the Following Statements Is True of Negligence by an Accountant

question 46

Multiple Choice

Which of the following statements is true of negligence by an accountant?

• A) The failure of an accountant to discover fraud by the client's employees or others is in itself proof of negligence by the accountant.
• B) The investigative techniques used by accountants will always uncover the fraud of a skillful and careful crook.
• C) The traditional defenses of contributory negligence and comparative negligence can apply in a negligence action against an accountant.
• D) It is not necessary to notify an appropriate person in management if an accountant has a basis for suspicion of fraud.

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Definitions:

Entrepreneurship

The process of designing, launching, and running a new business, often characterized by innovation, risk-taking, and the pursuit of growth.

Intrapreneurship

The practice of developing a new venture within an existing organization to innovate or drive new product development.

Typical Entrepreneur

Often portrays an individual who is innovative, takes risks, and pursues opportunities for growth and development in business ventures.

Small Businesses

Entrepreneurial ventures or companies with a small number of employees and relatively low revenue, typically characterized by close customer relationships and local operations.