In a Common Law Action Against an Accountant,lack of Privity

question 35

Multiple Choice

In a common law action against an accountant,lack of privity is a viable defence if the plaintiff ________.

• A)is the client's creditor who sues the accountant for negligence
• B)can prove the presence of gross negligence that amounts to a reckless disregard for the truth
• C)is the accountant's client
• D)bases the action upon fraud

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Definitions:

Allowances For Spoilage

Financial adjustments made for the anticipated loss of goods due to spoilage during production or storage.

Inefficiency

The lack of ability or effectiveness to transform inputs into outputs in a cost-effective manner, often resulting in wasted resources.

Practical Standard

An achievable standard that takes into consideration normal working conditions and expected operational inefficiencies.

Skilled Worker

An employee who possesses specialized knowledge or abilities, typically acquired through training or experience.