Read the following extract.
The overall objective of the financial statement audit is to add credibility to management’s financial reports …
Essential Component Every financial market, and subsequently all financial regulators, relies on the existence of meaningful and reliable financial statements. The external audit provides the essential component of independent assurance, which is necessary for the provision of reliable financial statements . ..
The high quality audit delivered in 2009 is a totally different service than the audit that would have been offered as little as 10 years ago. What has remained constant over this time is the value of the independent assurance provided by the audit process ...
Expectation Gap There is a segment of the market that sees an external audit as the guarantee against poor management behaviour, questionable business decisions and, ultimately, against corporate failure … We are all well aware that a corporate failure does not always equate to an audit failure.

1. What is meant by independent assurance?
2. Give some examples of lack of independence.
3. Comment on the statements in the paragraph headed 'Expectation Gap'.
4. How do management's and auditors' responsibilities differ?
5. Why is the integrity of management important to the financial reporting process?