Indicate whether you think the following third-party groups would normally represent a (1) primary beneficiary, (2) foreseen party, or (3) foreseeable party. Give reasons for your answers.

a. A potential purchaser of a business who asks for audited financial statements of that business and is known to the auditor.

b. A potential purchaser of a business who asks for audited financial statements of that business and is unknown to the auditor. However, the auditor knows that his or her client has asked for an audit because of an intention to sell the business.

c. A purchaser of a business who, unknown to the auditor, relied on the audited financial statements to help make the decision to buy the business. The auditor had been led to believe that the client would use the financial statements only for a bank loan.

d. A local bank which, as a condition of a loan, requires that audited financial statements be furnished to it by the borrower’s auditors. There is no other reason for the audit to be conducted.

e. An investor in securities of a public company.

f. A bank that makes loans to retail companies audited by a CPA in the same city. The CPA has never conducted business with the bank but does know that the bank makes loans to retail companies.