Fact Pattern 14-A3 (Questions A16-A17 Apply)

question 33

Multiple Choice

Fact Pattern 14-A3 (Questions A16-A17 apply)
Flip,an accountant,certifies an audit for Erstwhile Corporation,Flip's client,knowing that Erstwhile will use the audit to obtain a loan from Deepwater Bank.Flip believes that the audit is true and does not intend to deceive the bank,but does not check the audit before certifying it.
-Refer to Fact Pattern 14-A3.On learning the truth,Deepwater's chief loan officer confronts Flip,who says,"I didn't know." This is

• A)a mistake of value.
• B)innocent misrepresentation.
• C)negligent misrepresentation.
• D)unconscionable.

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Definitions:

Legal

Legal pertains to matters related to laws, the system of rules that are created and enforced through social or governmental institutions to regulate behavior.

Unethical

Behaviors or actions that are morally wrong, not conforming to accepted standards of conduct.

Business Ethics

The use of ethics and ethical principles to solve business dilemmas.

Standards

Established benchmarks or criteria that define the quality, quantity, and functionality of products, services, or processes.