The correct answer is D. Civil or criminal.
An auditor’s liability can be either civil or criminal. Civil liability is a legal obligation to compensate someone for damages caused by one’s actions. Criminal liability is a legal obligation to be punished for a crime.
An auditor may be held civilly liable for negligence, fraud, or breach of contract. Negligence is the failure to exercise the care that a reasonable person would exercise in a similar situation. Fraud is the intentional deception of another person for personal gain. Breach of contract is the failure to fulfill the terms of a contract.
An auditor may also be held criminally liable for fraud or other crimes. Fraud is a crime that involves knowingly deceiving another person for personal gain. Other crimes that an auditor may be charged with include obstruction of justice, perjury, and money laundering.
The liability of an auditor can be significant. In some cases, an auditor may be required to pay millions of dollars in damages. In other cases, an auditor may be sentenced to prison.
It is important for auditors to be aware of the potential for liability and to take steps to avoid it. This includes performing their audits in a competent and professional manner, documenting their work, and obtaining adequate insurance coverage.