Surprisingly, many cynical parents answer this question with: "no, I don't think so. It's just one day".
The NAPLAN tests your child's basic abilities in literacy and numeracy and alerts teachers and parents of these levels so that intervention strategies may be applied to help your child in the future.
Perhaps then, it is best to rephrase the above question to: "Does it matter if my child is achieving basic literacy and numeracy skills and I am made aware of it?"
Why would anyone argue the contrary?
It is true that there are some drawbacks to the test itself. Firstly, if your child suffers from anxiety and becomes nervous in test conditions, this can affect the results. Or maybe your child is having an 'off day' or is suffering from an illness - this may also have a bearing. What if your child is dyslexic or has ADHD - the time constraints will most certainly impact the overall score.
However, despite the limitations above, it can still be a useful tool for tracking your child's learning.
In my experience, children who have reasonable literacy and numeracy skills finish the test easily without any problems and achieve an average standard band.
If you are using NAPLAN practice books, be careful. Some books, particularly the Excel range, are geared for higher learning (about two years above) and are not grade appropriate.
The best preparation can be done with past paper practice tests found online.