An Accounting Firm Made Serious Errors in Providing Audited Financial

question 84

Multiple Choice

An accounting firm made serious errors in providing audited financial statement to ABC Limited.These statements are used by management,shareholders,and potential shareholders.

• A)Potential shareholders who relied on these statements may succeed in suing the accounting firm in contract.
• B)Potential shareholders who relied on these statements may succeed in suing the accounting firm in negligence if the accounting firm has not acted according to the reasonable-person standard.
• C)Potential shareholders who relied on these statements may succeed in suing the accounting firm in negligence if the accounting firm has not acted according to the standard set for accounting firms.
• D)ABC Limited cannot sue the accounting firm in contract because ABC should have examined the statements itself.
• E)None of these.

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Definitions:

Anxious/Avoidant

A style of attachment seen in some individuals who typically avoid close relationships and exhibit anxiety about getting close to others.

Anxious/Resistant

A type of attachment style observed in some children, characterized by intense distress when separated from caregivers and ambivalence upon their return.

Parenting Responses

The actions or reactions of parents in response to their child's behavior, needs, or emotional states, which play a crucial role in the child's development and wellbeing.

Moral Reasoning

The process of determining right and wrong in situations, guided by personal, societal, or ethical principles.