Under the Securities Act of 1933,which of the following defenses is related to auditors performing a reasonable investigation of the financial statements?
A)Causation
B)Contributory negligence
C)Due diligence
D)Prudent auditor

Question

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The defense related to auditors performing a reasonable investigation of the financial statements is called "due diligence." This defense holds that auditors can avoid liability under the Securities Act of 1933 if they can show that they took reasonable steps to investigate the accuracy and completeness of the financial statements before they were issued. Causation and contributory negligence are not defenses related to auditors, while the concept of a "prudent auditor" is a standard of professional conduct for auditors, not a defense against liability.

Under the Securities Act of 1933,which of the Following Defenses