Answer: Ultramares corporation v. Touche established Ultramares doctrine. Hochfelder v. Ernst & Ernst ruled that scienter is required before CPAs can be held liable.
Explanation:
All the options except the above are true. Ultramares corporation v. Touche did establish the Ultramares doctrine.
United States v. Natelli sentenced two CPAs to prison for a year, in addition to fines, for violating the Securities Exchange Act of 1934.
Bily v. Arthur Young did not uphold the restatement doctrine. The restatement doctrine restatement doctrine makes an auditor liable to people who rely on the quality of his work be they his clients or third parties. Two high courts ruled that auditors are not liable to third parties who use their work but only to the party that contracted their work.
However, Hochfelder v. Ernst & Ernst ruled that an allegation of scienter (an intention to deceive) is not required before CPAs can be held liable as long as the actions constitute actual deception.
While rule 10b-5 of the Exchange Act states the presence of scienter as a requirement to commit an offense, the court ruled against the statute by eliminating the Scienter clause from criminal statute and ruled against Ernst & Ernst.
<span>This finding questions the validity of the personality scores. If the test scores are not accurate then the test is useless. The test should either be reworked and improved to make its scores more valid or the test should not be allowed to be taken since it will mislead people about their personality.</span>
Command Economy - Japan North/South Korea
Mixed Economy - Taiwan China
