One of the Elements Necessary to Hold a CPA Liable

question 53

Multiple Choice

One of the elements necessary to hold a CPA liable to a client for conducting an audit negligently is that the CPA:

• A)acted with scienter or guilty knowledge.
• B)was a fiduciary of the client.
• C)failed to exercise reasonable care.
• D)executed a fraudulent engagement letter.

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Definitions:

Wye-Connected

A method of connecting three-phase motors or transformers where the ends are connected to form a "Y" shape, facilitating the use of both line and phase voltages.

Phase Current

The current that flows through any one phase of a multi-phase system, like in three-phase electrical systems.

Resistive Load

An electrical load that consumes power in the form of heat, and its resistance essentially remains constant throughout its operation.

Line Voltage

The voltage measured between any two phases in a multi-phase electrical system.