Liability of auditors, Business Law and Ethics

Assignment Help:

Liability of auditors:

It would cover any act of negligence - any actionable wrong by an officer of a company which did not involve any misapplication of the assets of the company.  Moreover the object of this section of the Act is to enable the liquidator to recover any assets of the company improperly dealt with by any officer of the company, and must be interpreted bearing which object in mind.  It doubtless covers any breach of duty by an officer of the company in his capacity of officer resulting in any improper misapplication of the assets or property of the company........ It is the duty of an auditor to bring to bear on the work he has to perform such skill, care, and caution that a reasonably competent, careful, and cautious auditor would utilize.  What is reasonable skill there, care and caution must depend on the particular circumstances of every each case.  Hence an auditor is not bound to be a inspection man, or, as was said like, to approach his work by suspicion or with a foregone conclusion that there is something wrong.  He is a watchdog, but not a blood bound.  He is justified in trusting, so tried servants of the company in whom confidence is placed through the company.  He is entitled to assume so that they are honest, and so rely upon their representations, just provided there, he takes reasonable care.  Whether there is anything calculated to excite suspicion than he should probe it to the bottom; therefore in the absence of anything like, he is only bound to be reasonably careful and cautious.  It is not the duty of an auditor to take stock; he is not a stock expert:, hence there are many matters in respect of that like he must rely on the honesty and accuracy of others.  He does not guarantee the innovation of all frauds.....  The duties of auditors must not be too onerous to rendered.  Therefore their work is responsible and laborious there, and the remuneration to moderate.


Related Discussions:- Liability of auditors

Dormant Commerce Clause, In 2001, Puerto Rico enacted a law that requires s...

In 2001, Puerto Rico enacted a law that requires specific labels on cement sold in Puerto Rico and imposes fines for any violations of these requirements. The law prohibits the sal

Deferred debts - disclaimer of assets, Deferred Debts - Disclaimer of asset...

Deferred Debts - Disclaimer of assets: Deferred Debts: A debt owed to a member as member, i.e. an unpaid dividend, is a deferred debt paid only when ordinary debts have b

Acceptance - negotiable instruments, Acceptance - Negotiable Instruments ...

Acceptance - Negotiable Instruments Meaning The word "acceptance" such used in relation to bills of exchange like has a special meaning also. Acceptance of a bill of ex

Case study:employment law, Jonathan has been in the continuous employment o...

Jonathan has been in the continuous employment of Dockland cleaning and laundry Co. Ltd since 1st August 2000. He is also a member and secretary of the Cleaning and Laundry Workers

Important step in the policy making process, QUESTION 1 (a) According t...

QUESTION 1 (a) According to Thomas Dye "Public Policy is whatever governments choose to do or not to do". How far do you agree? (b) Explain clearly how the first important s

Analyse the extent of the criminal liability, One night Mr Kokintou and Ms ...

One night Mr Kokintou and Ms Mangetou, entered into a housethrough a window which was negligently left open by the owner of the house.  Whilst Ms Mangetou was keeping guard at the

Purchase of own shares - merger accounting, Purchase Of Own Shares: An...

Purchase Of Own Shares: Another possible way in which a company's paid-up capital may leave the company other than in the ordinary course of the company's business would be if

Powers of arbitral tribunal, Powers of Arbitral Tribunal Powers of Arb...

Powers of Arbitral Tribunal Powers of Arbitral Tribunal are as Follow: For determine whether it has jurisdiction to entertain a dispute and For provide interim reme

Plan the disciplinary interview, Question: You are the manager of a res...

Question: You are the manager of a restaurant and receive a letter from a customer complaining about the quality of service and the rudeness of one member of your staff. You ha

Issue is sanctioned by the court - allotment of shares, Issue is sanctioned...

Issue is sanctioned by the court - allotment of shares: Not less than one year has elapsed since the company was entitled to commence business. This provision obviates the

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd