Explain Why External Auditors Perform Compliance Testing When a Main

question 116

Essay

Explain why external auditors perform compliance testing when a main objective of a financial statement audit is to express an opinion regarding the fairness of the monetary balances in a company's financial statements.

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Definitions:

Contractual Obligation

A contractual obligation is a duty or responsibility recognized by law that arises out of a contract agreement between parties.

Breach Of Contract

The failure of one party to fulfill the terms agreed upon in a contract, potentially leading to legal action for remedies.

Negotiate

The process of discussing something to reach an agreement or compromise.

Additional Benefits

Supplemental compensations or perks provided by employers beyond basic salary, including health insurance, retirement plans, etc.