Auditor’s report

The Auditor's report is a formal opinion, or disclaimer thereof, issued by either an internal
auditor or an independent external auditor as a result of an internal or external audit or
evaluation performed on a legal entity or subdivision thereof (called an “auditee”). The report
is subsequently provided to a “user” (such as an individual, a group of persons, a company, a
government, or even the general public, among others) as an assurance service in order for
the user to make decisions based on the results of the audit.

Most types of businesses and not for profit organizations rely on the auditor’s report as part
of their annual financial reporting back to investors, a Board of Directors, and other
individuals who have an interest in the ongoing success of the organization. Essentially, an
auditor’s report is a device that certifies that an outside auditor has examined the financial
records of the organization. The auditor’s report also includes what is referred to as an
auditor’s opinion, which in essence reports and comments on the findings of the
investigation.

IT IS A GENERALLY ACCEPTED belief that the process of corporate governance is the

relationship between a company's shareholders, directors, and management as defined by the
corporate charter, bylaws, formal policy, and rule of law. If corporate governance is to work,
both internal and external auditors have critical roles to play. Each must provide assurance to
directors and management on the integrity of financial statements and the adequacy of
internal controls. To be effective, the auditors must maintain their independence. Although
the external auditor is protected in theory from undue management influence, in practice,
both the internal and external auditors experience such pressure.