Civil liability of a company auditor is for __________.

Wilfully making a false statement

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Negligence

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses

Mis-statement in prospectus

No worries! We‘ve got your back. Try BYJU‘S free classes today!

All of the these

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Open in App

Solution

The correct option is D Negligence
Liability for negligence comes under the civil liability of the auditor.
Under the law of Agency the auditor is liable for negligence and in such a case has to pay damages to the aggrieved party or parties.
However, wilfully making a false statement or mis-statement in the prospectus comes under the criminal liability of the auditor.

Suggest Corrections

Similar questions

In the statement mentioned, state whether it is true or false.
In a company, the liability is unlimited to their investment in the company.

The auditor noticed that the financial statements of Meta Company were missing some footnotes important for users for decision making. This action of the management is a violation of:

Q. As a promoter is in a fiduciary relationship with the unformed company, he is never permitted to make a profit out of the companys promotion. Statement is true of false.

Q. Which of the following statement is true and which is false?
P. A company being a body corporate can sue but cannot be sued in its own name.
Q. Members or shareholders are agents of a company. R. Members of a company cannot contract with company.
R. A partner's liability is always limited where as that of shareholder may be unlimited either by shares or a guarantee.

Select the correct the answer from the options given below-

P Q R

Which financial statement presents a summary of the Assets, Liabilities, and Shareholders' Fund of a company?

Join BYJU'S Learning Program