Who does the auditor address the audit report to and why?

The auditor addresses the audit report to the entity's stakeholders, which typically include the board of directors, management, and shareholders. This is done to provide an independent assessment of the financial statements' accuracy and compliance with accounting standards. The report aims to enhance transparency and accountability, offering stakeholders assurance regarding the entity's financial health and operations. Additionally, addressing the report to these parties ensures that it meets the informational needs of those who rely on the financial statements for decision-making.