How Does the Securities Act of 1933,which Imposes Civil Liability

question 45

Multiple Choice

How does the Securities Act of 1933,which imposes civil liability on auditors for misrepresentations or omissions of material facts in a registration statement,expand auditors' liability to purchasers of securities beyond that of common law?

• A)Purchasers only have to prove loss caused by reliance on audited financial statements
• B)Privity with purchasers is not a necessary element of proof
• C)Purchasers have to prove either fraud or gross negligence as a basis for recovery
• D)Auditors are held to a standard of care described as professional skepticism

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Definitions:

Increased Work

A situation where the volume or intensity of tasks and responsibilities assigned to an individual or team grows.

Training

Provides learning opportunities to acquire and improve job-related skills.

Tardiness

The act of being late or delaying arrival beyond the expected or scheduled time.