When shareholders use audited statements as the basis for their investment decisions,court-imposed policy has shaped the law to consider this use outside the intended statutory purpose of the audit.In so doing,the courts have allowed the professional to be released from any duty of care to these individuals for any investment losses incurred as a result of reliance on the audit.

Question

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The statement suggests that courts have allowed auditors to be released from duty of care towards shareholders who rely on audited statements for investment decisions.

When Shareholders Use Audited Statements as the Basis for Their