A claim for a breach of duty of care might arise against an auditor if:
A)an existing shareholder suffered losses because he increased his investment in the company based on figures in the audited financial report.
B)a bank made a loss due to a loan made to the company based on figures in an audited financial report commissioned by the bank.
C)a new investor suffered losses because she purchased shares in the company based on figures in the annual audited financial report.
D)a finance company made a loss due to a loan made to the entity based on figures in an audited financial report commissioned by the entity.

Question

Quizplus · Accepted Answer

An auditor owes a duty of care to parties who rely on their reports, especially if the report was specifically commissioned by that party, such as a bank.

A Claim for a Breach of Duty of Care Might