A material fraud was discovered at Conner Co shortly after the auditor had presented anunmodified audit report to the annual general meeting. His standard letter of engagementindicated that he “would plan the audit so as to have reasonable expectation of detectingmaterial misstatements in the financial statements resulting from errors or fraud”, but alsostated that the primary responsibility for the prevention and detection of fraud lay withmanagement.Which of the following statements most accurately reflects the likelihood of the auditorbeing held liable for the failure to find the fraud?
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