Fraud has 5 elements:
1. misrepresentation of material fact/ knowledge of irregularities
2. INTENT TO DECEIVE (Knowing the statement was false) = SCIENTER
3. Actual & justifiable reliance on misrepresentation by plaintiff
4. Intent to induce that reliance
5. Damage
GROSS NEGLIGENCE & CONSTRUCTIVE FRAUD has 5 elements:
1. Misrepresentation of material fact/ knowledge of irregularities
2. DEFENDANT ACTS **RECKLESSLY** (Keyword , and differentiates from *fraud* above)
3. Actual and justifiable reliance on misrepresentation by plaintiff
4. Intent to induce that reliance
5. Damages
NEGLIGENCE ALONE
1. Breach of duty of care
2. Casualty or injury
3. plaintiff : NO NEED TO SHOW *RELIANCE*
So, usually CPA exam questions tend to also focus on types of DEFENSE that can be used by a CPA, etc. to defend themselves against the : Fraud, Negligence, Gross Negligence
Also, the other main point, Who is a CPA, etc. liable to when they are accused of the above .
Example: Negligence –> CPA liable to client, any person or foreseeable class of persons whom the cpa or the firm KNOWS will be RELYING on he cpa's work.
Gross Negligence –> CPA liable to client, any person or foreseeable class of persons whom the cpa or the firm knows will be relying on the cpa's work +++ any other plaintiff that was effected.
AUD - 77
BEC - 79
FAR - 75
REG - 80
Won't know until you try.
FAR: 76
REG: Currently studying
AUD:
BEC:
.