Law · Auditing and Professional Ethics
Consider the following statements about advice given by an auditor: (1) Auditors who provide negligent advice may be held liable for breach of contract by the company which appointed them. (2) Auditors who provide negligent advice to the company which appointed them may be held liable for breach of contract by individual shareholders directly. (3) Auditors who provide advice to a third party and know how the advice will be used may be held liable in negligence to that party. Which of the statement(s) given above is/are correct?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 11 only
- 21 and 2 only
- 31 and 3 only✓
- 42 and 3 only
Correct answer
1 and 3 only
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