The concept of three-party accountability means that the auditor is expected to act in the interests of the party paying the audit fee.

Question

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The concept of three-party accountability means that the auditor is responsible for accountability to three parties- the company being audited, the users of the financial statements, and regulatory authorities. The auditor is expected to act in the public interest and maintain independence to provide an unbiased opinion on the financial statements. Hence, the auditor is not expected to act solely in the interest of the party paying the audit fee.

The Concept of Three-Party Accountability Means That the Auditor Is