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Auditors derive their power from several key sources, including legal authority, professional standards, and organizational mandates. Legally, they are empowered by regulations and laws that define their roles and responsibilities, such as those established by the Sarbanes-Oxley Act in the U.S. Professionally, they adhere to standards set by organizations like the International Auditing and Assurance Standards Board (IAASB) and the American Institute of CPAs (AICPA). Additionally, their authority is reinforced by the trust placed in them by stakeholders, including shareholders, management, and regulatory bodies, which enables them to conduct independent assessments and report on financial statements effectively.

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1mo ago

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