Final answer:
An auditor testing by sampling shipping documents to see if invoices were prepared is assessing the assertion of completeness. The purpose is to ensure that all transactions that should be recorded are indeed documented in the financial statements.
Option 2. Comleteness is correct.
Step-by-step explanation:
When an auditor selects a sample from the file of shipping documents to determine whether invoices were prepared, this test is primarily performed to assess the assertion of completeness. This means that the auditor is checking to ensure all shipping events that should have been invoiced were indeed invoiced.
Auditor's tests for completeness help to confirm that all transactions and events that should have been recorded are in fact reflected in the financial records. It’s a crucial part of financial auditing as it can uncover instances where transactions have occurred but have not been documented properly. Other assertions like authorization and accuracy, cutoff, and occurrence focus on different aspects of the financial records—authorization relates to whether all transactions have been properly approved, accuracy checks for correctness of amounts and other data, cutoff asserts transactions have been recorded in the correct accounting period, and occurrence verifies that the transactions have actually taken place and are valid.