Cpas' Civil Ranging Study

The extension of the third party concerning the CPA's civil liability, which occurs when an accountant issue a blemished audit report or lead some loss of the report users, is a focus of liability litigation and disputed question in regulation all over the world. This paper devoted itself to the aim of giving a clear track of this problem and some rational suggestions to the domestic legislation by exploring prejudication, lawmaking worldly and the cause of formation behind.This paper is divided into four parts, as follows:The first part focuses on German law. Germany Civil law of 1896 stands negatively concerning this problem. Along with the economic rights blended into individual possessions, the statute law conflicted to the changing economy condition. Germany Court had to use prejudication based on Contract Liability Theory in order to protect injured third party. Three modes have been used: Tolerant Attitude Contract, Contract to protect third party, Defect in making contract. Interpretation and comparison is completed.The second part transfers to the common law. The author analyzes three kinds of standards: Relative Party in Contract, known Third Party and Foreseeable Third Party. The study is based on individual cases and sentiments of judges. And the causes of the three standards as well as the economic backgrounds are meantime investigated.The third part devotes to statute law. Security Law in 1933 and Security Exchange Law in 1934 are the emphases of the study. Although there are great different in Common Law and Security Law, the differences lies in the presidial range. They cover each other in different ways. The definitude regulations affect the way of judges settle a lawsuit.The last but not the least, domestic problem of the extension of the third party concerning the CPA's civil liability covers two aspects: mendacious auditing and false statements in security market. The profound meaning of establishing the domestic law concerning the CPA's civil liability is expatiated also.