Question

An audit seeks to provide _____ that the financial statements are free from material error.

• A. 100% guarantee
• B. Only reasonable assurance
• C. Perfect assurance
• D. All of the above

Answer 1

Answer: (B)

Only reasonable assurance

An auditor has a duty to provide reasonable assurance that material misstatements will be deleted. An audit seeks to provide reasonable assurance about fairness of financial statements.

The auditor's opinion helps in determination of true and fair view of financial statements. If the auditor believes that the financial statements are not properly stated, the auditor has the responsibility of notifying financial statement users through the auditors report.