The audit of companies is mandatory because a company is a distinct legal personality, an artificial person with it's own assets and liability, having shareholder who exercises proprietary interest on it's assets and as such investing their money in the company, and managed by the board of directors who are charged with seeing to the smooth running of the company and ensure shareholders obtain adequate return. An audit is carried out to ensure that the financial statement presented by the board present a true n fair view of the financial position of the company and as such protect the interest of the shareholders. But a partnership or proprietorship is managed by individuals who are owners of their businesses and who go into business for the sole purpose of making profit and as such can protect their own interest as they deem fit..
