Why is auditing important in a free market society?
A) The public requires auditors to function as divisions of regulatory bodies.
B) Auditors detect all errors and fraud perpetrated by company employees.
C) It provides reliable information upon which to judge economic performance.
D) The auditor is an amiable insurance policy for investors.
E) All of the above are true.

Question

Quizplus · Accepted Answer

Auditing provides reliable information about the financial performance and health of companies, which is essential for investors to make informed decisions in a free market society. It also helps to maintain transparency and accountability in the financial reporting process, ultimately contributing to the stability and efficiency of the economy. While auditors may detect errors and fraud, their primary role is not to act as a division of regulatory bodies or as an insurance policy for investors.

Why Is Auditing Important in a Free Market Society