Asked by Jennifer Zuniga on May 01, 2024
Verified
Under the ________, an accountant is liable to known third-party users of the accountant's work product and also to those in the limited class whose reliance on the work the accountant specifically foresaw.
A) Ultramares rule
B) Class test
C) Reliance rule
D) Restatement test
E) Carroll rule
Ultramares Rule
A legal doctrine determining the liability of accountants for negligence to third parties who rely on their financial reports.
Work Product
Documents, materials, or information prepared in anticipation of litigation, protected from discovery by opposing counsel.
Limited Class
A category with restrictions in terms of the number or type of members it can include, often used in legal contexts or when issuing securities.
- Gain understanding on the primary principles of the responsibility of accountants towards third parties, encompassing the acknowledgment of differing rules (such as Ultramares, Restatement).
Verified Answer
Learning Objectives
- Gain understanding on the primary principles of the responsibility of accountants towards third parties, encompassing the acknowledgment of differing rules (such as Ultramares, Restatement).
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