What is the primary purpose of an audit?

The primary purpose of an audit is to evaluate the accuracy and reliability of a company's financial statements. Audits are performed to ensure that the financial records reflect a true and fair view of the company's financial position and performance. This process involves examining the company’s financial statements, accounting practices, and internal controls.

An audit seeks to provide assurance to stakeholders, including investors, creditors, and regulatory bodies, that the financial information presented by the company is free from material misstatements, whether caused by fraud or error. This fosters trust and confidence in the financial reporting process and helps safeguard the integrity of the financial system. Ultimately, accurate and reliable financial statements are crucial for informed decision-making by various stakeholders, including potential investors and management.

While other options may be valuable for a company's operations—like assessing employee performance, marketing strategies, or pricing strategies—these do not align with the principal objective of an audit, which specifically focuses on financial statement accuracy and reliability.