Under the Liability Provisions of Section 11 of the Securities

question 10

Multiple Choice

Under the liability provisions of Section 11 of the Securities Act of 1933, a CPA may be liable to any purchaser of a security for certifying materially misstated financial statements that are included in the security's registration statement. Under Section 11, which of the following must be proven by a purchaser of the security?

• A)The CPA committed fraud and the purchaser relied on the financial statements.
• B)The purchaser relied on the financial statements, but not that the CPA committed fraud.
• C)The CPA committed fraud, but not that the purchaser relied on the financial statements.
• D)Neither that the CPA committed fraud, nor that the purchaser relied on the financial statements.

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Definitions:

Imipramine

A medication primarily used in the treatment of major depression and enuresis (bed-wetting) in children.

Tricyclics

A class of antidepressant medications used to treat depression and other mood disorders by affecting neurotransmitter levels in the brain.

Nutraceuticals

Products derived from food sources with extra health benefits in addition to the basic nutritional value found in foods.

Intolerable Side Effects

Adverse reactions to medications or treatments that are so severe they outweigh the benefits and may necessitate discontinuation or change in therapy.