Financial statements independent auditors´ civil liability

Abstract

This essay deals with the essence of the auditors’ civil liability according to the  Argentine Law. It shows that  the audit contract is a legal “work contract” that is satisfied by delivering the auditors´ report. Auditors’ obligation is an ”obligation to do” which is  classified as "an obligation of results", being the liability  attribution factor  "objective". This implies that the auditors, in order to free themselves from the liability for the  contract fulfillment , must prove the interruption of the casual link between the damage alleged by the principal and their work. For third partiesclaimants, the liability attribution factor is subjective and they will be responsible for proving the auditors’ fraud or negligence. Finally, the law requires the auditors to be more  diligent about and to be able to foresee  the consequences of their  actions with respect to someone who lacks training. If they are  liable for damages, they shall be  responsible for both, the mediate and immediate consequences of their work. The auditors’ liability is limited to  three years from the date on which  the provision become enforceable.