The legal term for when an auditor issues an audit opinion, knowing that an adequate audit was not performed, is a

Question

Quizplus · Accepted Answer

Constructive fraud occurs when a party misrepresents information or fails to disclose information, even if they did not intend to commit fraud. An auditor who issues an audit opinion knowing that an adequate audit was not performed is committing constructive fraud by misrepresenting the reliability of the audit results to the users of the financial statements. Breach of contract and negligence may also be applicable in certain situations, but constructive fraud is the most accurate description of the scenario provided. Actual fraud requires intent to deceive, which may not necessarily be present in this situation.

The Legal Term for When an Auditor Issues an Audit