Help sought understanding auditing options

Question

So, I have been asked to assist a site collection owner in implementing reporting of who has permissions to read or modify files within certain sensitive areas of the site collection.
I am aware that there is a way to implement site collection auditing.
1. As far as I can tell, there is no way out of the box to just audit individual sites or libraries within a site collection. Is that correct?
2. Where does the auditing data go - sql server data base or the server's local disk?
3. When trimming is implemented, are the audit reports stored in SharePoint or a shared folder?
4. Is there a way to set up a SharePoint group so that members can access the audit reports without the user being a member of the site collection administrators group?
Thank you

Answer 1

I have continued to read on this subject and it does not seem very clear to me.
I have yet to find instructions on the steps to turn on auditing on just one specific library.  Instead, what I have read seems to indicate that I need to do the following:
1. create a site collections policy at the site collection level that indicates that I want to turn on auditing.
    When I try this, a caution appears that auditing of "some" events is enabled for all sites in the site collection, regardless of which events are selected. What does that mean? What if I don't
want auditing for all sites on the site collection? Do I have to check events, or can I leave them all unchecked so that only when I get to the specific library I choose what events to audit?
2. assign that policy to a specific document type - such as "Documents" - at the site collection level by going to the site collection content types, selecting the specific types that may need audited, then selecting information management policy
editing
    The same warning as I mentioned in 1 is also here. If I want auditing for documents in just one library of one site, is that doable, or am I forced to have auditing for all documents in all libraries in this site collection?
    When I look at the site collection content types, there are all sorts of content types available. What if management needs to audit all current and future document types for a library? 
There appears to be no way to handle this situation in advance - is that the case? Does this require someone monitoring the library and updating policies when new types are uploaded to a library?
3. at the library level where I want auditing, go to the library settings > information management link. The content type should now display the policy name. Clicking on the content type should allow one to turn on auditing for that library or list. However,
this is NOT what I see. Instead, I see a message telling me that a policy has already been set for the content type – and in fact, content types for which I did
NOT create a policy now have on
This appears to indicate that auditing is going to take place anywhere in the site collection instead of just the specific library and content type that I was attempting to select
in step 3.
I feel like either I have an incomplete or totally incorrect understanding of the auditing - or what I am wanting to do is not possible in SP 2010.
What is desired is to be able to look at the actions against a specific library in a specific site and to determine when someone gains access to it that should not and determine whether or not that person actually accessed the information to which they should
not have been given access.