The auditor is required to express an opinion on a set of financial statements. Audit risk is

Question:

The auditor is required to express an opinion on a set of financial statements. Audit risk is the probability that the auditor will express an incorrect opinion resulting in financial loss to persons acting upon the audit opinion given. There are laws and regulations in place which provide protection for who suffer losses from reliance on the auditor's report which may be found "lacking".
In reference to the legal and regulatory framework of the auditing profession, what are the circumstances under which you may consider the to be "lacking" and the auditor liable for financial losses suffered by ? Do you believe that the laws and regulations provide sufficient protection for the auditor carrying out his/her professional duty with due diligence and care or do you perceive an imbalance in favor of the ?
Required:
Discussion on the issues outlined above in relation to the rights, responsibilities and obligations / liabilities of the auditor.
Audit Report
The audit report is issued by a certified public accountant who is appointed by the shareholders to provide assurance upon the truth and fairness of the financial statements prepared by the managers of the company. Audit report contains the... Stakeholders
A person, group or organization that has interest or concern in an organization. Stakeholders can affect or be affected by the organization's actions, objectives and policies. Some examples of key stakeholders are creditors, directors, employees,...