Zander decides to invest in the stock of Wolf Enterprises after he reads Edgar's audit,which includes a statement,known by Edgar to be false,as to the value of numerous worthless securities held as corporate assets.If Zander sues Edgar in a state using the broadest test for determining an accountant's liability for negligence to third parties,he will be entitled to:

Question

Quizplus · Accepted Answer

The broadest test for determining an accountant's liability for negligence to third parties is the foreseeability test. Under this test, a plaintiff can recover damages if they are a reasonably foreseeable plaintiff. Since Zander is an investor who relied on the audit to make his investment decision, he is a foreseeable plaintiff who may recover damages from Edgar for the false statement in the audit. Therefore, option B is correct. Options A, C, and D are not applicable in this situation.

Zander Decides to Invest in the Stock of Wolf Enterprises