In most states, accountants are subject to liability for negligence not only to their clients but also to foreseen or known users of the accountants' reports.

Question

Quizplus · Accepted Answer

Accountants can be held liable for negligence to both their direct clients and to any third parties that the accountants knew or should have foreseen would rely on their reports, such as investors or financial institutions, under the principle established in cases like Ultramares Corp. v. Touche and further developed in subsequent case law and state statutes.

In Most States, Accountants Are Subject to Liability for Negligence