Certified Government Auditing Professional (CGAP) Practice Exam 2026 – The All-in-One Guide to Exam Success

Performance audits play a critical role in government auditing by focusing on the efficiency and effectiveness of government programs. These audits assess whether the programs are achieving their intended outcomes, utilizing resources appropriately, and delivering value for public money. Through performance audits, auditors evaluate processes and operations, identifying areas where improvements can be made to enhance service delivery and optimize resource allocation.

Option B emphasizes the core purpose of performance audits, which is to analyze how well government entities meet their established objectives and whether they do so in an economically sound manner. This aspect is vital for promoting accountability in the public sector and ensuring that taxpayer funds are used effectively.

The other options address different facets of governmental functions but do not capture the essence of performance audits. Compliance with tax laws, accuracy of financial statements, and budget establishment relate more to compliance auditing and financial auditing rather than the evaluative nature of performance audits.