Question 1

RICO was originally drafted as part of the 1980 Organized Crime Control Act.

Accepted Answer

A) True 
 B)False

Question 2

Anyone identified to the auditor by name prior to the audit who is to be the principal recipient of the auditor's report is a

Accepted Answer

A)  third party. 
B)  foreseen beneficiary. 
C)  primary beneficiary. 
D)  foreseeable party. 
E)  secondary beneficiary. 
A)  third party. 
B)  foreseen beneficiary. 
C)  primary beneficiary. 
D)  foreseeable party. 
E)  secondary beneficiary.

Question 3

An auditor would be guilty of gross negligence for delivery of a report past the agreed-upon date.

Accepted Answer

A) True 
 B)False

Question 4

The auditor's working papers are of little importance in refuting charges for breach of contract and breach of duty in a tort action.

Accepted Answer

A) True 
 B)False

Question 5

Match between columns
                        Premises: An SAS on subsequent events was issued after the decision.
The accountant’s liability for ordinary negligence was extended to foreseen groups.
The critical issue was the CPA’s failure to inform the client of employee wrong-doings, regardless of the service rendered.
The jury found that the requisite of scienter was met through the accountant’s negligence.
The auditors were convicted of criminal charges.
Accounting firms should no longer be permitted to hide within the citadel of privity and avoid liability for their malpractice.
The accountant should not be held liable to any third party for negligence except to a primary beneficiary.
Plaintiffs claimed the accountants were negligent in their audit because they had not challenged or investigated the “mail rule.”
The accounting firm was guilty of breach of contract because they did not comply with the specific representation in their engagement letter.
The court concluded that the defendant knew that his certification was to be used for potential financiers.
The court concluded that the accountant should be held liable to reasonably foreseeable parties for ordinary negligence.
The work done by the senior did not meet the standards of the profession because he did not take some of the steps prescribed in the auditing firm’s written program.
Accountant should not be exposed to a liability in indeterminate amounts, for an indeterminate time, to an indeterminate class.
The defendant accountant was orally engaged to perform a service for the plaintiff.
The government charged that the defendant’s disclosure of related party relationships was false and misleading.
When a statute speaks so specifically in terms of manipulation and deception, we are quite unwilling to extend the scope of the statute to negligent conduct.
When the independent auditor furnishes an opinion with no limitation on its dissemination, he has a duty to all those whom that auditor should reasonably foresee as recipients.
The judge instructed the jury to determine whether the financial statements fairly presented financial position without reference to GAAP.
The U. S. Supreme Court rendered the decision.
The jury found the accountants guilty of aiding and abetting violations of securities laws (Rule 10b-5) and common law fraud.

Accepted Answer

The Answer of Ultramares Corp. v. Touche and 1136 Tenants is...

Question 6

The 1136 Tenants case showed that the accountant's working papers cannot be used against him.

Accepted Answer

A) True 
 B)False

Question 7

The Restatement (Second) of Torts extends the auditor's liability for ordinary negligence to a specific but unlimited group of users for whose benefit the auditor intends to supply the information.

Accepted Answer

A) True 
 B)False

RICO was originally drafted as part of the 1980 Organized Crime Control Act.

Anyone identified to the auditor by name prior to the audit who is to be the principal recipient of the auditor's report is a

An auditor would be guilty of gross negligence for delivery of a report past the agreed-upon date.

The auditor's working papers are of little importance in refuting charges for breach of contract and breach of duty in a tort action.

The 1136 Tenants case showed that the accountant's working papers cannot be used against him.

The Restatement (Second) of Torts extends the auditor's liability for ordinary negligence to a specific but unlimited group of users for whose benefit the auditor intends to supply the information.

Auditing and the Public Accounting

Financial Statement Audits and

Professional Ethics

Overview of the Audit Process

Audit Evidence, Audit Objectives,

Accepting the Engagement and

Materiality Decisions and Performing Analytical Procedures

Audit Risk, Including the Risk of Fraud

Understanding Internal Controls

Audit Procedures in Response to Assessed Risks: Tests of Controls

Audit Procedures in Response to Assessed Risks: Substantive Tests

Audit Sampling in Substantive Tests

Auditing the Revenue Cycle

Auditing the Expenditure Cycle

Auditing the Production and

Auditing the Investing and

Auditing Investments and

Completing the Audit and Postaudit

Attest and Assurance Services, and Related Reports

Internal, Operational, and

Filters

Exam 4: Auditors Legal Liability

RICO was originally drafted as part of the 1980 Organized Crime Control Act.

Anyone identified to the auditor by name prior to the audit who is to be the principal recipient of the auditor's report is a

An auditor would be guilty of gross negligence for delivery of a report past the agreed-upon date.

The auditor's working papers are of little importance in refuting charges for breach of contract and breach of duty in a tort action.

The 1136 Tenants case showed that the accountant's working papers cannot be used against him.

The Restatement (Second) of Torts extends the auditor's liability for ordinary negligence to a specific but unlimited group of users for whose benefit the auditor intends to supply the information.

Auditing and the Public Accounting

Financial Statement Audits and

Professional Ethics

Overview of the Audit Process

Audit Evidence, Audit Objectives,

Accepting the Engagement and

Materiality Decisions and Performing Analytical Procedures

Audit Risk, Including the Risk of Fraud

Understanding Internal Controls

Audit Procedures in Response to Assessed Risks: Tests of Controls

Audit Procedures in Response to Assessed Risks: Substantive Tests

Audit Sampling in Substantive Tests

Auditing the Revenue Cycle

Auditing the Expenditure Cycle

Auditing the Production and

Auditing the Investing and

Auditing Investments and

Completing the Audit and Postaudit

Attest and Assurance Services, and Related Reports

Internal, Operational, and

Filters