Which of the following would third parties not need to demonstrate when bringing suit against auditors for losses sustained under the Securities Act of 1933?
A) Auditors were aware of the materially misstated financial statements.
B) Third-party purchasers suffered a loss.
C) The client's financial statements contained a material misstatement.
D) Purchasers would need to demonstrate all of the above.

Question

Quizplus · Accepted Answer

Under the Securities Act of 1933, third parties do not need to prove that auditors were aware of the materially misstated financial statements. They only need to show that there was a material misstatement and that they suffered a loss.

Which of the Following Would Third Parties Not Need to Demonstrate