EBK AUDITING: A RISK BASED-APPROACH
11th Edition
ISBN: 9781337670203
Author: RITTENBERG
Publisher: YUZU
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Question
Chapter 4, Problem 6RQSC
a.
To determine
Breach of Contract
A breach of contract is a failure to do what the contract requires. It is an unjustifiable failure by a party who promises to act according to the provision of the agreement.
To explain: The justification given by an auditor for defending a suit under breach of contract.
b.
To determine
Statutory Law
Statutory Law is a written law which passed by the legislature. It is created deliberately by the government through elected legislators and an official legislative.
To explain: The justification given by an auditor for defending a suit under statutory law.
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What types of actions may an auditor be liable to a client under common law? Why
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Generally, the auditor could be legally liable under?
Select one:
a. contract law but not under the tort of negligence to third parties
b. the tort of negligence to the client and contract law
c. the tort of negligence but not contract law to the client
d. contract law to third parties and to the client
Chapter 4 Solutions
EBK AUDITING: A RISK BASED-APPROACH
Ch. 4 - Prob. 1CYBKCh. 4 - Prob. 2CYBKCh. 4 - Prob. 3CYBKCh. 4 - Prob. 4CYBKCh. 4 - Prob. 5CYBKCh. 4 - Prob. 6CYBKCh. 4 - Prob. 7CYBKCh. 4 - Prob. 8CYBKCh. 4 - Prob. 9CYBKCh. 4 - Prob. 10CYBK
Ch. 4 - Prob. 11CYBKCh. 4 - Prob. 12CYBKCh. 4 - Prob. 1RQSCCh. 4 - Prob. 2RQSCCh. 4 - Prob. 3RQSCCh. 4 - Prob. 4RQSCCh. 4 - Prob. 5RQSCCh. 4 - Prob. 6RQSCCh. 4 - Refer to the Focus on Fraud feature “Moss Adams...Ch. 4 - Prob. 8RQSCCh. 4 - Prob. 9RQSCCh. 4 - Prob. 10RQSCCh. 4 - Prob. 11RQSCCh. 4 - Prob. 12RQSCCh. 4 - Prob. 13RQSCCh. 4 - Prob. 14RQSCCh. 4 - Prob. 15RQSCCh. 4 - Prob. 16RQSCCh. 4 - Prob. 17RQSCCh. 4 - Prob. 18RQSCCh. 4 - Prob. 19RQSCCh. 4 - Prob. 20RQSCCh. 4 - Prob. 21RQSCCh. 4 - Able Corporation decided to make a public offering...Ch. 4 - KPMG (LO 1, 2, 3) KPMG LLP served as the external...Ch. 4 - ToshIba, EY (LO 1, 2, 3) In 2015, the business...
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- What is the auditors responsibility regarding the noncompliance with laws by a client?arrow_forwardHow does the prudent person concept affect the liability of the auditor?arrow_forwardHow would an auditor communicate known there are violations of the law and the auditor's responsibilities according to the law?arrow_forward
- What is the auditor's obligation in light of the prudent person concept?arrow_forwardIf either party fails to perform their contractual obligations according to the contract terms, it will usually result in a breach of contract. The scope and nature of an auditor's contractual obligation to a client ordinarily is established in the: Select one: a. Corporations Act 2001. b. Management letter. c. Client’s constitution. d. Engagement letter.arrow_forwardDistinguish between the legal concepts of actually foreseen third-party users and reasonably foreseeable third-party users. How does each concept establish a basis for an auditor’s legal liability to third parties?arrow_forward
- Explain the auditor legal liability, this includes what law that procure such liability?arrow_forwardCompare and contrast auditor liability under contract law vs. tort law.arrow_forwardAuditors may be held liable to both their clients and third parties under common law. a. What must a client prove to recover its losses from the auditors under common law? b. In a court that adheres to the precedent set by the Ultramares v. Touche case, what must an ordinary third party prove to recover losses from the auditors under common lawarrow_forward
- How does the auditor’s opinion differ between scope limitationscaused by client restrictions and limitations resulting from conditions beyond the client’scontrol? Under which of these two will the auditor be most likely to issue a disclaimer ofopinion? Explain.arrow_forwardwhich of the following is true? a.When what is to be delivered is a generic thing, the creditor may ask a person other than the debtor to perform the obligation. b.Dolo incidente relates to the fraud committed at the time of the perfection of a contract. c.When negligence is imputed as a cause for the breach in an obligation, the same is presumed.arrow_forwardWhich of the following is NOT a possible legal risk that can arise because of a fraud investigation conducted in an improper manner? A. Forcible entry and detainer. B. Invasion of privacy. C. Defamation. D. Malicious prosecution.arrow_forward
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