Under Which of the Following Tests Is an Accountant Held

question 64

Multiple Choice

Under which of the following tests is an accountant held liable to any third party that was or should have been foreseen as a possible user of the accountant's work product and that, in fact, did use and rely upon that work product for a proper business purpose?

• A) The Reasonably Foreseeable Users Test
• B) The Restatement Test
• C) The Privity Test
• D) The Near Privity Test
• E) The Ultramares Rule

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Definitions:

Cash Deficiency

A situation where a business or individual has insufficient cash to cover expenses or liabilities.

Planning Process

A systematic approach to setting goals and objectives, developing strategies, and outlining tasks and schedules to accomplish the goals.

Company's Past Performance

A review of a company's previous financial results and operations, usually analyzed to forecast future performance.

Communication Goals

Objectives that an individual or organization aims to achieve through communication efforts, including increasing awareness, influencing perceptions, or driving behavior changes.