An audit of financial statements is conducted to determine whether the:
A) overall financial statements are stated in accordance with specified criteria.
B) organisation is operating efficiently and effectively.
C) auditee is following specific procedures or rules set down by a peer group authority.
D) none of the above

Question

Quizplus · Accepted Answer

An audit of financial statements is specifically conducted to determine whether the overall financial statements are stated in accordance with specified criteria, such as generally accepted accounting principles. The efficiency and effectiveness of an organization's operations are not the primary focus of a financial statement audit. An audit may involve testing whether an auditee is following specific procedures or rules, but only as they relate to the preparation of the financial statements. Therefore, choice A is the best answer.

An Audit of Financial Statements Is Conducted to Determine Whether