What limitation does the Minority Ultra Mares rule impose on CPA liability?

The Minority Ultra Mares rule focuses on the liability of Certified Public Accountants (CPAs) regarding the individuals and entities that can hold them accountable for negligence in their auditing and financial reporting services. Specifically, this rule limits the liability of CPAs to those third parties for whom the CPA intended to benefit from the provided services, often referred to as "intended third-party beneficiaries."

This legal principle stems from the need to define clear boundaries around CPA responsibilities and the potential exposures they face from claims beyond their direct clients. By limiting liability to intended third-party beneficiaries, the rule recognizes the importance of the CPA’s scope of work and purpose in relation to their clients and their clients’ relationships with others. This means that other third parties who may rely on financial statements or reports produced by the CPA cannot sue for negligence unless it can be demonstrated that the CPA intended for them to benefit from those services.

As for the other options, they either misunderstand the rule's focus or present limitations that do not align with established legal principles concerning CPA liability. For instance, limiting liability to clients only does not capture the essence of third-party relationships. Future earnings and non-disclosure cases do not reflect the specific intent underlying liability as established by the Minority Ultra Mares rule.