Exam 6: Legal, Regulatory, and Professional Obligations of Auditors

A payment made to a foreign government official to ensure that s/he does what is expected given their job requirements can be characterized as a:

A privity relationship means that

Whistleblowing as a result of a financial fraud may be appropriate under

Two court decisions illustrate the application of Section 11 of the Securities Act of 1933. Identify those cases and explain the legal issues involved in each one.

What are the best defenses that an auditor can use to defend oneself against charges of fraud? How does ethical behavior relate to these defenses?

When courts find accountants liable for constructive fraud, the implication is that

Which Act requires firms who engaged in international operations to have internal controls and an audit committee?

In the SEC case of James Gansman:

What is a worrisome consequence under the joint and several liability principle?

The Livingston & Haynes case involves the audit firm

The Insider Trading and Accounting Professionals case deals with

What is meant by "intangible honest services?" How does it relate to the case against Jeff Skilling in the Enron fraud? How do the charges against skilling relate to director and officer fiduciary responsibilities?

Should auditors be held legally liable for a fraud at a client even though top management intentionally withheld information from the auditors and even deceived them?

Under section 302 of the Sarbanes-Oxley Act of 2002, the financial statement certifying officials must include in their certification that

Michael Trent Reznor, the lead singer in the band Nine Inch Nails, filed a lawsuit against Richard Szekelyi and the Navigent Group in the Reznor v. JAM, Inc. case alleging:

All of the following proof can be used in an auditor's defense against third party lawsuits for fraud except for:

Auditors may be held liable to both their clients and third parties under common law. a. What must a client prove to recover its losses from a client under common law? b. What must a third party prove to recover losses from an auditor under common law? c. How does an auditor's ethical obligations and liability under common law intersect?

Rajat Gupta was sentenced to two years in prison and ordered to pay a $5 million fine for

Section 10A of the Securities Exchange Act of 1934 establishes each of the following requirements for auditors of public companies with respect to illegal acts except for

Which of the provisions of the Sarbanes Oxley Act do you think has had the most important effect on the quality of audits by public companies in the U.S.? Why?