Busineess Law and the Legal Environment

Indeed, the law upholds for the accountability among the accountants for their own action through the assessment of the accountants’ liability to third parties. As a result, both the two rules the Restatement rule and the Ultramares doctrine seek to determine the levels of accountant’s liability however, their benefits differ thus, making one appropriate over the other. Restatement rule is better as compared to Ultramares doctrine as it allows for more accountability to the third party. Ultramares rule advocates accountants to owe a duty of care only to those persons who primarily benefit from the accountants statement such as persons who are in privity or are so close to approach the privity with the accountants. However, restatement rule makes additional amendments to the ultramares rule as it also endorses accountants to be responsible to third parties whom they intend to supply the information to and also whether its use will influences their decision making through the use of information.

The deontological ethical perspective upholds for the accountabiliyty of accountants as they carry out their duties in such a manner as to avoid misleading the users of the information (Beatty & Samuelson, 2006). Through this ethical principle there is no doubt that accountants should be held responsible for their actions that would affect even the remote user of the information they give through the publication of the financial statement.

Without doubt, under the contemporary business running the accountants are often sued as “deep pockets” because they have to be responsible through their duty of care as their negligence might lead them to be liable for their own actions. According to the laws they cannot avoid facing the lawsuits filed against them by the affected third parties and general users of information contained in the act (Beatty & Samuelson, 2006). This is because there unethical actions that lead to fraud would not be inevitable among other accountants if action is not undertaken on those who breach their duty of care.