The correct answer is: D. None of the above
An auditor is an independent professional who is appointed by the shareholders to review the financial statements of a company and report on their fairness and accuracy. The auditor is not an employee of the company, nor is he or she an agent of the shareholders. The auditor is an independent professional who is responsible to the public for his or her work.
The auditor’s role is to provide assurance to the shareholders that the financial statements are fairly presented in accordance with generally accepted accounting principles (GAAP). The auditor does this by conducting an audit, which is a systematic process of gathering and evaluating evidence to determine whether the financial statements are free from material misstatement.
The auditor’s report is a communication to the shareholders about the results of the audit. The report includes the auditor’s opinion on whether the financial statements are fairly presented in accordance with GAAP, as well as any other matters that the auditor considers necessary to communicate to the shareholders.
The auditor’s report is an important part of the financial reporting process. It provides assurance to the shareholders that the financial statements are reliable and that they can be used to make informed decisions about the company.
Here is a brief explanation of each option:
- Option A: The auditor is an employee of the company. This is incorrect because the auditor is an independent professional who is appointed by the shareholders.
- Option B: The auditor is an agent of the company. This is incorrect because the auditor is an independent professional who is responsible to the public for his or her work.
- Option C: The auditor is an agent of the shareholders. This is incorrect because the auditor is an independent professional who is responsible to the public for his or her work.