Practice point: An accountant may be liable in negligence to a third party if the accountant knew that the financial reports were to be used for a particular purpose, and that they would be relied on.
Students should note that in order to establish accounting fraud, plaintiff must show misrepresentation of material fact, scienter, reliance and damages.
Case: Barrett v Freifeld, NY Slip Op 07130 (2d Dept. 2010)
Here is the decision.
Monday's issue: Motion practice.
