Question

Which of the following is/ are principal function of audit?

• A. To check whether applicable accounting principal has been followed or not.
• B. To compare the financial statements with the books of account and supporting vouchers.
• C. To ascertain that the final accounts are been made in accordance with the underlying records.
• D. All of above.

Answer 1

The correct option is D All of above.

It is the auditors responsibility to verify all the business transactions along with the verification of documentary evidence available. The main object of audit is to detect and prevent the frauds and provide the opinion on financial statements to ensure that it gives true and fair view of the accounts.

To conduct the audit of an organization, auditor has right to access books, accounts, vouchers and ask for all the information and explanation wherever required. It is the prime function of the auditor to check whether the accounts are prepared by following generally accepted accounting principles and financial statements are prepared on the basis of books of account maintained along with the physically available records.