CIVIL LIABILITY UNDER Describe accountants' civil liability THE FEDERAL SECURITIES LAWS under the federal securities laws and related defenses securities Act of 1933 The Securities Act imposes an unusual burden on the auditor. section ll of the 1933 act defines the rights of third parties and auditors. Involves new security issues Securities Exchange Act of 1934- The liability of auditors under this act often centers on the audited financialstatements issued to the public in annual reports or submitted to the sec as a part of annual Form 10-K reports. Fraud=Rule 10b-5 dining & EArens, Loebbecke; Auditing, 8/E ©2000 Prentice Hall, Inc, Describe accountants’ civil liability under the federal securities laws and related defenses. CIVIL LIABILITY UNDER THE FEDERAL SECURITIES LAWS Securities Act of 1933 The Securities Act imposes an unusual burden on the auditor. Section 11 of the 1933 act defines the rights of third parties and auditors. Involves new security issues - Securities Exchange Act of 1934 - The liability of auditors under this act often centers on the audited financial statements issued to the public in annual reports or submitted to the SEC as a part of annual Form 10-K reports. Fraud=Rule 10b-5