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Generally, the auditor could be legally liable: O under contract law but not under the tort of negligence to third parties. O

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Answer #1

Correct Answer : under contract law and under tort of negligence to the client.

Reason : There is a contractual relation between the auditor and his client and he is liable to fulfill the contract. An auditor is also liable under the tort of negligence (Damages caused due to negligence) towards the client and third party

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