A CPA is subject to a criminal liability if the CPA
A) Refuses to turn over the working papers to the client
B) Performs an audit in a negligent manner
C) Willfully omits a material fact required to be stated in a registration statement
D) Willfully breaches the contract with the client

Question

Quizplus · Accepted Answer

A CPA can be criminally liable for willfully omitting a material fact required to be stated in a registration statement. This is a violation of securities laws and can result in serious consequences. Refusing to turn over working papers or breaching a contract may result in civil liability, but not criminal liability. Performing an audit in a negligent manner may result in disciplinary action or civil liability, but not necessarily criminal liability.

A CPA Is Subject to a Criminal Liability If the CPA