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

Agency law - agency and partnership, Agency Law - Agency and Partnership ...

Agency Law - Agency and Partnership Sources of Agency Law However the law of agency in the US is based on the common law rules that have been developed through the Engl

Legal environment in the education sector, QUESTION 1 The use made of d...

QUESTION 1 The use made of decision-making bodies such as commissions, boards, tribunals and statutory bodies for the purpose of achieving celerity in public affairs opens the

Statutory companies, Statutory Companies: A statutory company is forme...

Statutory Companies: A statutory company is formed by a specific Act of Parliament, primarily as a means of conferring on it some powers which would not be available to it if

Contracts of indemnity, Contracts of Indemnity Indemnity is the undert...

Contracts of Indemnity Indemnity is the undertaking about primary responsibility to see like a certain act is performed there.If a particular contractual promise such constitu

Illustrate the principle of authority or power, Illustrate the principle of...

Illustrate the principle of authority or power Authorities are delegated by the Principal to agents and it is the characteristic of all the governments. This delegation of auth

Determine in detail about the credibility factor, Determine in detail about...

Determine in detail about the credibility factor Let us consider, 'credibility' factor. The law, institutions and other created authorities lead to circumstances that can assur

High court - establishment and composition, High Court - Establishment and ...

High Court - Establishment and Composition Establishment Further the High Court is established through S.60 (1) of the Constitution that states which 'there shall be a

What do you mean by garnishee orders, Q. What do you mean by Garnishee Orde...

Q. What do you mean by Garnishee Orders? The ATO has the power to issue garnishee orders which allow recovery of debts from a person's bank account, wage or from people who owe

The advisory council for occupational safety and health, QUESTION 1 Dis...

QUESTION 1 Discuss the functions of the following- (a) The Workfare Programme (b) The Advisory Council for Occupational Safety and Health (c) Health and Safety Officer

Show the criminal conduct definition of phoenix activity, Q. Show the Crimi...

Q. Show the Criminal conduct definition of phoenix activity? Master Builders argued that the definition of phoenix activity should focus on the existing sections of corporation

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