The primary objective of compliance testing in a financial statement audit is to determine whether:
A)Procedures have been updated regularly.
B)Financial statement amounts are accurately stated.
C)Internal controls are functioning as designed.
D)Collusion is taking place.

Question

Quizplus · Accepted Answer

Compliance testing in a financial statement audit is aimed at evaluating whether the entity's internal controls are operating effectively and as designed. This helps auditors assess the reliability of the financial reporting process.

The Primary Objective of Compliance Testing in a Financial Statement