L22 Notes_Part_7 - Fraud If an auditor has acted with knowledge and intent to deceive a third party he or she can be held liable for fraud Law

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Common Law—Third Parties Near Privity 3 rd parties whose relationship with the CPA approaches privity. Foreseen 3 rd Parties 3 rd parties whose reliance should be foreseen, even if the specific person is unknown to the auditor. Reasonably Foreseeable 3 rd Parties 3 rd parties whose reliance should be reasonably foreseeable, even if the specific person is unknown to the auditor. Ultramares (1931) Credit Alliance (1985) Security Pacific Business Credit, Inc. (1992) Rusch Factors, Inc. (1968) H. Rosenblum, Inc. (1983) Privity Yes Yes Yes Yes Near Privity No Yes Yes Yes Foreseen Third Parties (Restatement Standard) No No Yes Yes Reasonably Foreseeable Third Parties No No No Yes Auditor's Liability to 3rd Parties for Negligence
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Unformatted text preview: Fraud If an auditor has acted with knowledge and intent to deceive a third party, he or she can be held liable for fraud. Law Common Law Statutory Law Civil Law (Action against another) Preponderance of the evidence Criminal Law (Actions against Society) Beyond a reasonable doubt Intentional •Assault & Battery •Slander •Libel •Trespass •Fraud Punitive damages Unintentional (negligence) Extent of Carelessness Ordinary Gross (willful and wonton recklessness) Damages to make injured party whole again Uniform Securities Act FCPA 1977 Mail Fraud False Statement Statute RICO SEC Act of 1933 SEC Act of 1934 Contract Law Tort Law...
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This note was uploaded on 10/05/2011 for the course ACG 5637 taught by Professor Monikacaushoulli during the Fall '08 term at University of Florida.

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L22 Notes_Part_7 - Fraud If an auditor has acted with knowledge and intent to deceive a third party he or she can be held liable for fraud Law

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