BLAW 4203 Chapter Notes - Chapter 47: Audit, Professional Negligence In English Law, Defalcation
Document Summary
Section 1 potential liability to clients(i. e. in privity of contract-a direct contractual relationship) Liability for negligence: plaintiff must prove: duty, breach, causation, damanges, standards of conduct, duty ofcare, ethics, accountant"s duty of care, violation of gaas, gaap are prima facie evidence of negligence as a acountant. Faireness of f/s: not intended to discover fraud, but liable if normal audit would have discovered it. ?/-- must be specific: adverse opinion there is material misstatement, unauditated fs. Must designate as unaudited: defense on negligence , accountant not negligent, negligent not the proximate cause of client"s loss, client also negligent, arrorney liability, misconduct-- lawyer should not engage in conduct involving. Dishonesty, fraud, deceit, or misrepresentation: malpractice- professional negligence. Intentional failure to perform duty: e. g. paula blindly accpts explanation to irregulatiries despite factual contradiction. Potential liability to third party not only when violate statutes, fraud, intentional wrongdoing. Persons that accountants intend to use f/s: 2.
