Which of the following statements is correct about the objective of the audit process?
A)Generally accepted auditing standards require the auditor to obtain assurance about whether the financial statements are free from all misstatements.
B)Reasonable assurance is obtained by the auditor when he has obtained sufficient appropriate audit evidence to reduce audit risk to an acceptably low level.
C)A misstatement is an error or fraud in the financial statements that might cause a user of the financial statements to change his decision about the company.
D)Sufficient appropriate audit evidence refers to the persuasiveness of the evidence gathered.

Question

Quizplus · Accepted Answer

The objective of the audit process is for the auditor to provide reasonable assurance (and not absolute assurance) that the financial statements are free from material misstatements. Material misstatements are those that could influence the decisions of the financial statement users. Reasonable assurance is obtained when the auditor has gathered sufficient appropriate audit evidence to reduce audit risk to an acceptably low level. Audit risk is the risk that the auditor may unknowingly fail to modify the opinion on the financial statements that are materially misstated.

Which of the Following Statements Is Correct About the Objective