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Foreseeability as a Determinant of Audit Responsibility.

Denzil Y. Causey

Assistant Professor, Graduate School of Business Administration, University of Santa Clara, California 1

The Accounting Review 1973

Abstract The article explores the concept of foreseeability as a determinant of the legal responsibility of auditors. Auditors have the ability to foresee that application of conservatism to avoid overstatement; elimination of disclaimers, qualifications and adverse opinions; and uniformity in application of accounting and auditing rules can limit users of financial statements to more realistic expectations. A balancing of the needs of users of financial reports for protection with the effect of imposing liability on auditors forms part of the question of auditor responsibility.

DOI
10.2308/tar-4497582
Volume
48 (2)
Pages
258-267
Language
en
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