Asked by Dorthie Brown on Apr 24, 2024
An accountant who fails to discover every impropriety in a client's books is liable to the client on a negligence theory for any resulting loss.
Negligence Theory
A legal principle asserting that a defendant's failure to exercise reasonable care under the circumstances results in unintentional harm to another party.
Impropriety
Inappropriate or unethical behavior or conduct.
- Determine the essential components needed to prove professional negligence, which include the obligation of care, violation of that duty, and the requirement to demonstrate harm.
- Familiarize oneself with the legal duties imposed on accountants to uncover and inform about any fraud or irregular financial activities in a client's accounts.
Learning Objectives
- Determine the essential components needed to prove professional negligence, which include the obligation of care, violation of that duty, and the requirement to demonstrate harm.
- Familiarize oneself with the legal duties imposed on accountants to uncover and inform about any fraud or irregular financial activities in a client's accounts.
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