What is the primary objective of a financial audit?

The primary objective of a financial audit is to assess compliance with applicable regulations. This entails a thorough examination of an organization's financial statements and internal controls to ensure they accurately represent the financial position of the business and are in accordance with generally accepted accounting principles (GAAP) and other regulatory requirements.

Financial audits serve to provide stakeholders, including investors, creditors, and regulatory agencies, with a level of assurance that the financial statements are free from material misstatement. By focusing on compliance, audits help organizations identify areas where they may need to improve their financial reporting processes, thereby promoting transparency and accountability.

While evaluating marketing strategies or determining employee performance metrics are important business functions, they do not fall under the primary objectives of a financial audit. Enhancing brand reputation is also critical for a business's success but is more related to marketing, public relations, and overall company management rather than the objective of conducting a financial audit.