Audit:

The audit is defined as a systematic examination of books of accounts of an individual or an organization. Auditing is done by the professional CPA; we call them auditors.

Auditor:

The auditor is the person hired by the owner for a systematic examination of books of accounts of the company. The auditor uses its professional knowledge and gathers evidence. It should be a question minded, plan, and being alert to the condition of the misstatement due to fraud and error.

SEC:

SEC is the first federal regulator market created in 1934. It is an independent agency of the federal government.

SEC authority in the accounting regulatory environment:

1. It oversees the security market and responsible for protecting investors.

2. It set a standard of ethics for the best practice for accounting.

3. It takes action against the lawbreakers.

4. It monitors the takeover action in the US and protecting the investor from the manipulate practice and fraudulent.