Examinations are an important part of the martial arts experience because it shows both the student and the instructor what the student is capable of.  Testing is more of a demonstration for the student allowing them to show the instructors and the other students what they have learned.  Belts, Stripes, and Certificates are then presented to the students to give them something tangible that shows their skill level.  Instructors and senior students are always looking out to gauge readiness of students and their skills.