Principles of Auditing & Other Assurance Services (Irwin Accounting)
20th Edition
ISBN: 9780077729141
Author: Ray Whittington, Kurt Pany
Publisher: McGraw-Hill Education
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Chapter 4, Problem 3RQ
To determine
Explain the term privity and its effect on the auditor’s liability under common law.
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How does auditors’ liability under statutory law arise?
what are the key practical differences between common-law liability and statutory liability for auditors, such as burdens of proof, consequences or penalties, intent, etc.?
Distinguish between common-law liability and statutory liability for auditors. What is the basis for the difference in liability?
Chapter 4 Solutions
Principles of Auditing & Other Assurance Services (Irwin Accounting)
Ch. 4 - Prob. 1RQCh. 4 - Prob. 2RQCh. 4 - Prob. 3RQCh. 4 - Prob. 4RQCh. 4 - Prob. 5RQCh. 4 - Prob. 6RQCh. 4 - Prob. 7RQCh. 4 - Prob. 8RQCh. 4 - Prob. 9RQCh. 4 - Prob. 10RQ
Ch. 4 - Prob. 11RQCh. 4 - Prob. 12RQCh. 4 - Prob. 13RQCh. 4 - Prob. 14RQCh. 4 - Prob. 15RQCh. 4 - Prob. 16RQCh. 4 - Prob. 17RQCh. 4 - Prob. 18RQCh. 4 - Prob. 19RQCh. 4 - Prob. 20QRACh. 4 - Prob. 21QRACh. 4 - Prob. 22QRACh. 4 - Prob. 23QRACh. 4 - Prob. 24QRACh. 4 - Prob. 25QRACh. 4 - Prob. 26QRACh. 4 - Gordon Moore, CPAs, were the auditors of Fox ...Ch. 4 - Prob. 28AOQCh. 4 - Prob. 28BOQCh. 4 - Prob. 28COQCh. 4 - Prob. 28DOQCh. 4 - Prob. 28EOQCh. 4 - Prob. 28FOQCh. 4 - Prob. 28GOQCh. 4 - Prob. 28HOQCh. 4 - Prob. 28IOQCh. 4 - Prob. 28JOQCh. 4 - Prob. 28KOQCh. 4 - Prob. 28LOQCh. 4 - Prob. 29OQCh. 4 - Prob. 30OQCh. 4 - Match the important cases listed below with the...Ch. 4 - Prob. 32OQCh. 4 - Prob. 33OQCh. 4 - Prob. 34PCh. 4 - Prob. 35PCh. 4 - Prob. 36PCh. 4 - Charles Worthington, the founding and senior...Ch. 4 - Prob. 38PCh. 4 - Prob. 39PCh. 4 - Prob. 40PCh. 4 - Prob. 41ITCCh. 4 - Prob. 42RDC
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Similar questions
- How does the prudent person concept affect the liability of the auditor?arrow_forwardDistinguish 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 defenses are available to auditors against suits brought by clients under common law? Against suits brought by third parties under common law?arrow_forward
- In your words, what is the legal responsibility of the auditor?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_forwardExplain the auditor legal liability, this includes what law that procure such liability?arrow_forward
- What are the implications of the cautious person notion for the auditor's legal responsibility?arrow_forwardWhat is the auditor's role when a client fails to follow the law?arrow_forwardWhat does a third-party user of financial statements have to prove under common law in a suit against an auditor for the auditor's negligence?arrow_forward
- For what type of actions can clients bring suit against auditors under common law? What must clientsprove prior to bringing suit in each case?arrow_forwardIs the auditor’s liability affected if the third party was unknownrather than known? Explainarrow_forwardDistinguish 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?arrow_forward
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