A CA May Be Liable to Any Purchaser of a Security

question 2

Multiple Choice

A CA may be liable to any purchaser of a security if the CA issued a clean opinion on materially misstated financial statements.The CA usually will not be liable to the purchaser ________.

• A)if the purchaser is guilty of contributory negligence
• B)if the CA can prove due care in the audit
• C)unless the purchaser can prove privity with the CA
• D)unless the purchaser can prove scienter on the part of the CA

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Definitions:

Exports

Goods or services provided by one country to another in exchange for foreign currency, contributing to a country's economic health.

Absolute Advantage

The ability of an individual, company, or country to produce a good or service at a lower cost per unit than the cost at which any other entity produces that good or service.

Exchange Rate

The price of one currency in terms of another currency for conversion purposes.

Raspberries

A small, red, edible fruit from the genus Rubus, valued for its sweet taste and nutritional benefits.