When an auditor has failed to conduct an adequate audit, liability may depend on the level of negligence.

Question

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If an auditor has been negligent in their duties, their liability may depend on the level of that negligence, as well as other factors such as the materiality of any errors or omissions discovered after the fact. In extreme cases, the auditor could be found to have committed fraud, which would likely result in greater liability.

When an Auditor Has Failed to Conduct an Adequate Audit