What term best describes the audit of a taxpayer's return?

The term that best describes the audit of a taxpayer's return is a compliance audit. This type of audit focuses on whether the taxpayer's financial information adheres to relevant laws, regulations, and standards. In the context of a taxpayer's return, a compliance audit is designed to ensure that the taxpayer has accurately reported their income, deductions, and credits while meeting all applicable tax obligations.

Compliance audits are typically conducted by tax authorities or regulatory bodies to verify that taxpayers are in compliance with tax laws. In these audits, the auditors examine the taxpayer's records and supporting documentation to assess whether the information submitted on tax returns is correct and in line with current tax legislation.

The other types of audits mentioned do not fit this context. A performance audit evaluates the efficiency and effectiveness of a program or operation, often in a governmental or organizational setting. A financial audit focuses on the fairness and accuracy of the financial statements of an organization, while a forensic audit investigates allegations of fraud or financial impropriety. Thus, the compliance audit is the most accurate description of the audit of a taxpayer's return, emphasizing adherence to tax laws and regulations.