Mylab Accounting With Pearson Etext -- Access Card -- For Auditing And Assurance Services (17th Edition)
17th Edition
ISBN: 9780135176115
Author: Alvin A. Arens, Randal J. Elder, Mark S. Beasley, Chris E. Hogan
Publisher: PEARSON
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Question
Chapter 5, Problem 10RQ
To determine
Differentiate among the auditor’s potential liability to the client, liability to third parties under common law, civil liability under the securities laws, and criminal liability. State one situation for each type of liability in which the auditor can be held legally responsible.
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Distinguish between the legal concepts of actually foreseen third-party users and reasonably foreseeable third-party users. How does each concept establish a basis for an auditor’s legal liability to third parties?
Explain the auditor legal liability, this includes what law that procure such liability?
Distinguish between common-law liability and statutory liability for auditors. What is the basis for the difference in liability?
Chapter 5 Solutions
Mylab Accounting With Pearson Etext -- Access Card -- For Auditing And Assurance Services (17th Edition)
Ch. 5 - Prob. 1RQCh. 5 - Prob. 2RQCh. 5 - Prob. 3RQCh. 5 - Prob. 4RQCh. 5 - Prob. 5RQCh. 5 - Prob. 6RQCh. 5 - Prob. 7RQCh. 5 - Prob. 8RQCh. 5 - Prob. 9RQCh. 5 - Prob. 10RQ
Ch. 5 - What potential sanctions does the SEC have against...Ch. 5 - Prob. 12RQCh. 5 - Prob. 13RQCh. 5 - Prob. 14.1MCQCh. 5 - Prob. 14.2MCQCh. 5 - Prob. 14.3MCQCh. 5 - Prob. 15.1MCQCh. 5 - Prob. 15.2MCQCh. 5 - Prob. 15.3MCQCh. 5 - Prob. 16.1MCQCh. 5 - Prob. 16.2MCQCh. 5 - Prob. 16.3MCQCh. 5 - Prob. 17DQPCh. 5 - Prob. 18DQPCh. 5 - Prob. 19DQPCh. 5 - Prob. 20DQPCh. 5 - Prob. 21DQPCh. 5 - Prob. 22DQPCh. 5 - Prob. 23DQPCh. 5 - Prob. 24DQPCh. 5 - Prob. 27DQPCh. 5 - Prob. 28C
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- Distinguish between common-law liability and statutory liability for auditors. What is the basis for the difference in liability, and what are the key practical differences between the two, such as burdens of proof, consequences or penalties, intent, etc.?arrow_forwardwhat are the key practical differences between common-law liability and statutory liability for auditors, such as burdens of proof, consequences or penalties, intent, etc.?arrow_forwardHow does auditors’ liability under statutory law arise?arrow_forward
- What is Legal Liability of Auditors?arrow_forwardWhat is the auditors responsibility regarding the noncompliance with laws by a client?arrow_forwardFor what type of actions can clients bring suit against auditors under common law? What must clientsprove prior to bringing suit in each case?arrow_forward
- In your words, what is the legal responsibility of the auditor?arrow_forwardDescribe the action that an auditor should take if an attorneyrefuses to provide information that is within the attorney’s jurisdiction and may directlyaffect the fair presentation of the financial statements.arrow_forwardWhat types of actions may an auditor be liable to a client under common law? Why would the clients prefer to sue the auditor for tort action rather than a breach of contract?arrow_forward
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