What is the purpose of an 'audit' in finance?

An audit in finance primarily serves the purpose of verifying the accuracy of financial records. This process involves a thorough examination of financial statements and related documents to ensure they accurately reflect the business's transactions and financial position. Auditors assess whether the financial records adhere to established standards and regulations, thus providing assurance to stakeholders, including investors, regulators, and management, regarding the integrity of the financial information.

By conducting audits, organizations can identify discrepancies or potential fraud, enhance the reliability of their financial reporting, and foster trust among stakeholders. This verification process is essential in maintaining transparency and accountability within the financial systems of businesses, which ultimately supports informed decision-making.

The other choices focus on different aspects of business operations rather than the specific purpose of an audit. Increasing profit margins, creating new investment opportunities, and evaluating employee performance are important but separate functions that do not directly relate to the primary goal of an audit, which is to ensure the accuracy and reliability of financial information.