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A plaintiff may elect to bring a lawsuit against auditors under applicable statutes-including the Securities Act of 1933 and the Securities Exchange Act of 1934-and

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A plaintiff may elect to bring a lawsuit against auditors under applicable statutes-including the Securities Act of 1933 and the Securities Exchange Act of 1934-and under common law. For each circumstance, indicate the most likely source of CPA liability by placing the appropriate letter in the third column Circumstance 1. A CPA's client is filing suit for negligence in Source of Liability performing an audit. 2. A stockholder of a publicly-held company who purchased the stock from another investor is filing suit for losses sustained on the stock. 3. A bank that lent money to a company is filing suit for misleading financial statements that were audited by the CPA. 4. An investor is filing suit for losses sustained in the purchase of publicly-traded bonds that were bought from the company upon initial registration. 5. A stockholder who purchased stock of a public company in an initial public offering is filing a suit for losses sustained in the purchase of the stock. 6. A CPA's client is filing suit for losses sustained for errors in a tax return prepared by the CPA. 7. A supplier who extended credit to the CPA'S publicly-held client is filing suit for losses sustained when the client could not pay the account. 8. An investor who purchased a corporate bond from another investor on the New York Stock Exchange is filing suit to recover losses

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