Question

The liability of an auditor can be ____________.

• A. Civil
• B. Criminal
• C. Civil and /or criminal
• D. None of the above

Answer 1

Answer: (C)

Civil and /or criminal

Following are the criminal liabilities of an auditor under the companies act:

• For false records (under section 539 of the companies act)
• For false statement (under section 628 of the companies act)
• For willful default (under section 233 of the companies act)

Following are the criminal liabilities of an auditor under the Income Tax act:

• For furnishing false Income (under section 278 of the Income Tax Act)
• For false report

In the following cases, there will be civil liability:

• Liabilities for negligence
• Liabilities under consumer protection act
• Liabilities for negligence of assistant
• Liabilities for un audited statements