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A lawsuit was settled after the audited financial statements had been issued. The issued statements contain a disclosure, in the footnote, of the lawsuit as
A lawsuit was settled after the audited financial statements had been issued. The issued statements contain a disclosure, in the footnote, of the lawsuit as a contingent liability and the lawyer's opinion that the outcome was expected to be favorable to the company. The settlement turned out to be a big loss for the company. What should the auditor do now? Explain your reasoning.
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