Truth Accounting,Inc

Truth Accounting,Inc.has been retained to perform an audit for a client.In doing the Audit,it fails to discover an embezzlement that has gone on for two years by the client's chief financial officer.The reason that Truth Accounting,Inc.failed to discover the embezzlement was because the auditor was in a rush to finish due to being too busy,so she did not conduct a reasonable investigation.Soon after the audit,the embezzlement is discovered,and the client goes bankrupt.If Truth Accounting,Inc.is sued,which of the following theories of liability apply?

A) the Ultramares doctrine
B) Section 552 of the Restatement (Second) of Torts
C) negligence
D) the foreseeability standard
E) strict liability

Correct Answer:

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