A Rule That Says That an Accountant Is Liable for Negligence

question 59

Multiple Choice

A rule that says that an accountant is liable for negligence to third parties who are projected users of the client's financial statements is known as ________.

• A) the foreseeability standard
• B) the Ultramares doctrine
• C) the due diligence defense
• D) the privity of contract

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Definitions:

Linear Island Chain

A sequence of islands that form in a straight line, often over a volcanic hot spot, as a tectonic plate moves over it.

Fracture Zone

An area of the ocean floor where tectonic plates have fractured, leading to seismic activity and the formation of geological structures.

Oceanic Trench

Deep, narrow depressions in the ocean floor, formed by subduction zones where one tectonic plate is forced under another.

Mid-ocean Ridge

An underwater mountain system formed by plate tectonics, featuring a continuous volcanic ridge at the boundary of diverging tectonic plates.