Under Common Law,which of the Following Statements Most Accurately Reflects

question 30

Multiple Choice

Under common law,which of the following statements most accurately reflects the liability of a CPA who fraudulently gives an opinion on an audit of a client's financial statements?

• A)The CPA is liable only to third parties in privity of contract with the CPA.
• B)The CPA is liable only to known users of the financial statements.
• C)The CPA probably is liable to any person who suffered a loss as a result of the fraud.
• D)The CPA probably is liable to the client even if the client was aware of the fraud and did not rely on the opinion.

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Definitions:

Informal Deviance

Behaviors that violate informal social norms or expectations but are not codified into law.

Rudeness

Behavior or speech that is disrespectful or impolite, often violating societal norms for courtesy and conduct.

Crime

One form of deviance; specifically, behavior that violates criminal laws.

White-Collar

Pertaining to jobs or workers in offices, administrative tasks, or professional fields, as opposed to blue-collar industrial work.