THE FAULT REQUIREMENT OF CIVIL LIABILITIES OF CPA'S FALSE FINANCIAL THE FAULT REQUIREMENT OF CIVIL LIABILITIES OF CPA'S FALSE FINANCIAL STATEMENTS FROM THE VIEWPOINT OF ECONOMIC ANALYSIS OF LAW

• Main Authors: Liaw Jim-pwu, 廖駿樸
• Other Authors: CHANG HSIN-TI
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/77414492899072182822

碩士 === 輔仁大學 === 財經法律學系 === 97 === The purpose of Securities and Exchange Act in Taiwan is illustrated on Article 1: To promote the national economic development and the protection of investors. While “No fraud” is an indispensible principle to achieve this goal, it means the financial reports or any other relevant financial or business documents filed or publicly disclosed by an issuer shall contain no misrepresentations or nondisclosures. The financial reports are important information for a third person to understand the company operating status. But are the reports issued by the issuers in compliance with GAAP? First, the outsiders are not entitled to inspect. In addition, the company accounting is too professional for ordinary people to understand. As a result, the statute requires the financial reports to be attested by the CPA to enhance the creditability. Suppose the CPA and the corporation management engage in fraudulence jointly, without doubt, the CPA should take responsibility for his/her action. But what if the CPA is negligent in performing his/her duties as CPA, shall he/she liable for the damages arising from his/her negligence? If we assume the answer is Yes, then what kind of fault requirement is appropriate? This paper starts with the incentive analysis, i.e. checking out whether the injurer or victim could take precautions against the accidents. And under different fault requirements, which one can induce incentive to take precautions? In conclusion, we realized the traditional fault (strict liability, no liability and simple negligence) is not appropriate from the incentive viewpoint for the CPA. This paper then studies whether we could allocate the burden of proof to the negligent party to be liable for his/her negligence via suit. In this part, this paper applies “the Hand Rules” and “the Game Theory” to illustrate the conversion of burden of proof to the CPA would minimize the social costs. After economic analysis, this paper suggests the fault requirement of SEA Article 20-1 for the CPA be the presumably negligence. However, it means the risk of attestation will increase simultaneously. Therefore, this paper also brings up some complementary measures to alleviate CPA’s liabilities subsequently.