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Pam Certified a Statement Prepared by Jace,her Employee,without Checking His

Question 43

Multiple Choice

Pam certified a statement prepared by Jace,her employee,without checking his work.Jace was never known to be anything but diligent and his integrity had never been questioned.The audit contained gross misstatements.Pam defends a suit against her claiming "due diligence." She will:


A) succeed,since she had no reason to believe her employee would lie.
B) succeed,because a reasonable person would not have inquired further.
C) fail,because due diligence requires reasonable investigation.
D) fail,because she is automatically liable for her employee's act.

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