An audit is an independent examination of financial statements under applicable auditing standards that results in an auditor's opinion on whether those statements are fairly presented under the relevant accounting framework.
For a stablecoin issuer, audited financial statements can provide evidence about assets, liabilities, income, expenses, and disclosures within the scope of the audit. An audit can include testing relevant to reserve assets, but the exact coverage depends on the financial statements, applicable standards, materiality, and the audit engagement. Stablecoin regulation in several jurisdictions combines financial audits with more frequent reserve-specific reporting or assurance requirements.
An audit of financial statements and a reserve attestation answer different questions. Their scopes, reporting periods, and assurance objectives can differ.
Clear terminology helps readers avoid treating a narrow reserve assurance report as equivalent to a full financial statement audit.
An issuer can publish annual audited financial statements while also publishing more frequent reserve assurance reports during the year.