Auditor Independence refers to the ability of auditors to perform their duties without any influence or bias from external parties. This independence is crucial for maintaining the integrity and objectivity of the audit process. When auditors are independent, they can provide an unbiased assessment of a company's financial statements, ensuring that stakeholders can trust the information presented. There are two main types of independence: independence in fact and independence in appearance. Independence in fact means that the auditor is free from any relationships that could impair their judgment. Independence in appearance ensures that the auditor's actions and relationships do not create a perception of bias, which is essential for maintaining public confidence in the audit.