Accountants’ Common Law Negligence Liability to Third Parties
Although the statutory liability of accountants to third parties under the federal securities laws is fairly clear, the scope of accountants’ common law negligence liability varies greatly among the states. This article begins by discussing the historical background of accountants’ common law liability for negligence. The article then presents the recent judicial decisions and rationales for their limitations on accountants’ third party liability. Finally, the article summarizes and analyzes the various judicial positions and supports the application of a traditional proximate causation philosophy to accountants’ negligence liability.
Volume 2014 | Issue 3
A selection from our current issue.
- The Systemic Risk Paradox: Banks and Clearinghouses Under Regulation
by Felix B. Chang
- The SEC and the Courts' Cooperative Policing of Related Party Transactions
by Geeyoung Min
- On Requiring Public Companies to Disclose Political Spending
by Michael D. Guttentag
- Speaking Up: The Challenges to Section 501(c)(3)'s Political Activities Prohibition in a Post-Citizens United World
by Hannah Lepow
- Intrastate Crowdfunding
by Matthew A. Pei
- Member FMIC: Credit-Risk Sharing Within and Without an FMIC-Based Housing Finance System
by Samuel P. Niles