The ultimate purpose of a substantive test is to _______.
A)ensure that all controls are functioning properly
B)obtain absolute assurance that an assertion is presented fairly in all material respects
C)obtain reasonable assurance that an assertion is presented fairly in all material respects
D)guarantee that no error or fraud exists in the financial statements

Question

Quizplus · Accepted Answer

The ultimate purpose of a substantive test is to obtain reasonable assurance that an assertion is presented fairly in all material respects. Substantive tests are designed to detect material misstatements in the financial statements, but they do not provide absolute assurance as there is always some level of inherent risk and limitations in any audit process. The purpose of controls testing is to ensure that all controls are functioning properly, and the purpose of the audit as a whole is to provide an opinion on the financial statements as a whole, not to guarantee the absence of error or fraud.

The Ultimate Purpose of a Substantive Test Is to _______