What is her potential liability

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A C.P.A., Brenda provides accounting serv­ices to Ernie's Earnings Corporation. The services include preparing Ernie's financial re­ports and issuing opinion letters based on the reports. In 2016, Ernie's falls into serious financial trouble, but neither Brenda's reports nor her opinion let­ters indicate this situation. Relying on Brenda's portrayal of Ernie's finan­cial situation, the firm borrows a large sum of money to build a new ship­ping facility. In lending Ernie's the money, Mid-First Bank relies on Brenda's opinion letter. Brenda is aware of this reliance.

If Brenda did not en­gage in intentional fraud but was negligent, what is her potential liability? Explain your answer thoroughly.

Reference no: EM131736706

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