Which of the Following Is the Best Defense a CPA

question 11

Multiple Choice

Which of the following is the best defense a CPA firm can assert in a suit for common law fraud based on its unqualified opinion on materially false financial statements?

• A)Contributory negligence on the part of the client.
• B)A disclaimer contained in the engagement letter.
• C)Lack of privity.
• D)Lack of scienter.

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Definitions:

Affluent

Having a great deal of wealth; characterized by richness and abundance.

Language Development

The process by which individuals acquire the capacity to perceive, produce, and use words to understand and communicate.

Nativist Approach

A theory in psychology that suggests skills or abilities are innate and genetically inherited rather than learned.

Noam Chomsky

A linguist, philosopher, cognitive scientist, and activist known for his theory of generative grammar, significantly influencing the field of cognitive science.