To Be Successful in a Civil Action Under Section 11

question 60

Multiple Choice

To be successful in a civil action under Section 11 of the Securities Act of 1933 concerning liability for a misleading registration statement,the plaintiff must prove which of the following?

• A) Defendant's intent to deceive: yes;Plaintiff's reliance on the registration statement: yes.
• B) Defendant's intent to deceive: yes;Plaintiff's reliance on the registration statement: no.
• C) Defendant's intent to deceive: no;Plaintiff's reliance on the registration statement: yes.
• D) Defendant's intent to deceive: no;Plaintiff's reliance on the registration statement: no.

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Definitions:

Direct Method

A way of preparing the cash flow statement where actual cash flows from operating activities are listed directly.

Administrative Expenses

Costs related to the general administration of a business, such as salaries of office staff, rent, and utilities.

Cash Basis

A method in accounting where revenues and expenses are recorded only when cash is received or paid out, respectively.

Statement of Cash Flows

A financial statement that summarizes a company's cash inflows and outflows over a specific period.