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QUESTION 3 A financial analyst describes his experiences about auditors, as below: "(Auditors') job is...

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QUESTION 3 A financial analyst describes his experiences about auditors, as below: "(Auditors') job is to provide a fair and impartial rendering of the company's financial health. Before financial statements are finalized, the auditors have to provide "comfort on the numbers. They usually spend a lot of time arguing with the company about what the right numbers should be, so their provision of professional comfort is generally accompanied by the acute feelings of personal discomfort. At the end of the day, the company can fire the auditors if it doesn't like the position they're taking. This means that the auditors tend to come around to the company's point of view if they want to keep the business. Usually, they want to keep the business." Required: Why do regulators regulate that financial statements should be audited? What does the above say about the limitations of regulations to ensure reliability of financial statements? Why is audit not a panacea to the problem of misrepresentation of the accounting numbers? (Warl

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