What is meant by 'audit assurance'?

Audit assurance refers to the level of confidence that an auditor expresses regarding the reliability of financial statements or other information subjected to an audit. This assurance is crucial as it helps stakeholders, including investors, regulators, and the public, to trust that the financial statements present a true and fair view of the entity’s financial position. The auditor evaluates the evidence gathered during an audit and provides an opinion based on that evidence, which is often categorized into different levels of assurance, such as reasonable assurance or limited assurance.

This concept is integral to the auditing process, as it underpins the auditor’s opinion and reflects the auditor’s professional judgment about the risks of material misstatement. Therefore, the measure of confidence conveyed by the auditor is a key outcome of the audit process, aimed at promoting transparency and accountability in financial reporting.