Factory Discount Prices Inc., is a chain store discount outlet which sells women's clothes. It has an excessively large inventory on hand and is in urgent need of additional cash. It is bordering on bankruptcy, especially if the inventory has to be liquidated by sale to other stores instead of the public. Furthermore, about 15% of the inventory is not resalable except at a drastic discount below cost. Faced with this financial crisis, Factory approached several of the manufacturers from whom it purchases. Dexter Apparel, Inc., one of the parties approached, indicated a willingness to loan Factory \($300,000\) under certain conditions. First, Factory was to submit audited financial statements for the express purpose of providing the correct financial condition of the company. The loan was to be predicated upon these financial statements and Factory's engagement letter with Dunn & Clark, its CPAs, expressly indicated this. The second condition insisted upon by Dexter was that it obtain a secured position in all unsecured inventory, accounts, and other related personal property. In due course a security agreement was executed and a financing statement properly filed and recorded. In preparing the financial statements, Factory valued the inventory at cost which was approximately \($100,000\) over the current fair market value. Also, Factory failed to disclose two secured creditors to whom substantial amounts are owed and who take priority over Dexter's security interests. Dunn & Clark issued an unqualified opinion on the financial statements of Factory which they believed were fairly presented. Six months later Factory filed a voluntary bankruptcy petition. Dexter received \($125,000\) as its share of the bankrupt's estate. It is suing Dunn & Clark for the loss of \($175,000.\) Dunn & Clark deny liability based upon lack of a contractual relationship and lack of negligence. 

Required:

Answer the following, setting forth reasons for any conclusions stated. Is Dexter entitled to recover its loss from Dunn & Clark?