When auditing inventories, an auditor would least likely verify thata. All inventory owned by the client is on hand at the time of the count.b. The client has used proper inventory pricing.c. The financial statement presentation of inventories is appropriate.d. Damaged goods and obsolete items have been properly accounted for.

Q: When verifying debits to the perpetual inventory records of a nonmanufacturing company, auditors…

A: Perpetual Inventory Records:   A process of accounting that constantly updates its records with…

Q: Which of the following management assertions is an auditor most likely testing if the audit…

A: Management Assertion:   Management assertion refers to the claim made by the management assuring…

Q: Following are audit procedures commonlyperformed in the inventory and warehousing cycle for a…

A: Audit procedure:   Audit procedures are used by auditors to determine the quality of financial…

Q: An auditor most likely would analyze inventory turnover rates to obtain evidence concerning…

A: Inventory turnover rate is the rate which shows how many times a company has sold and replaced it's…

Q: Explain whether or not analytical review procedures would be sufficient for the audit of the…

A: Auditing is the examination and verification of the financial statements prepared by the entity and…

Q: In the audit of inventory the auditor must perform important procedures prior to the actual…

A: Audit of inventory refers to the cross-verification of inventory physically present with the…

Q: Which of the following audit procedures is the best test of the accuracy, valuation and allocation…

A: An inventory audit is an audit where an auditor cross-checks the inventory records with the…

Q: The auditor is verifying whether all goods received by the company have been recorded appropriately.…

A: Auditor is one who audits the financial statement of company so as to provide fair view on the…

Q: what are the audit asssertions related to inventory?

A: Audit is the process of checking and examining books of accounts and financial statements so that it…

Q: the auditor is verifying whether all goods received by the company have been recorded appropriately.…

A: Source Documents - Source documents are the document using which auditor can check the genuineness…

Q: Which of the following is an analytical procedure? a. Analysis of significant ratios and trends b.…

A: Analytical  procedures are performed to evaluate the financial information.

Q: During the taking of physical inventory, the controller intentionallywithheld several inventory tags…

A: The simple meaning of word Audit is 'doing inspection or examination' and the process of audit is…

Q: The auditor selects a sample of asset disposals and examines the sales documentation evidencing…

A: An audit is one of the important processes that is used for financial statements. Financial…

Q: If you are an auditor and assigned to audit inventory. So as an auditor 1. How do you ensure that…

A: Honor Code: Since you have posted a question with multiple sub-parts, we will solve the first 3…

Q: Auditing an attestation client's inventory accounts can vary widely in complexity and time required…

A: Inventory accounts are audited to report on the true and fair state of inventory balances on a…

Q: An audit trail enables a person to trace a source document to its ultimate effect on the financial…

A: Audit trails are manual or electronic records that are chronologically defined events to provide…

Q: when the auditor Watch employees count inventory to determine whether company procedures are being…

A: Ans. An auditor carries out various audit procedures like observation, inspection, confirmation,…

Q: Which of the following procedures is usually performed by the auditor to determine if obsolete…

A: Obsolete inventory is an inventory that gets obsolete and remains unserviceable and loses its…

Q: For each of the audit procedures listed below state the primary ‘Assertion’ and the related…

A: Audit Assertion Financial statement account 1 Review and test the procedures for identifying…

Q: You are testing inventory.  You determined that inventory exists, nothing is missing from inventory,…

A: The following are some examples of inventory risks: Due to the difficulty of valuing inventory, it…

Q: Which of the following will be the most appropriate test to determine wherether purchase orders are…

A: Purchase order: Purchase order is a document send by a buyer to seller indicating all the…

Q: Explain the significant inherent risks associated with inventory. Explain the process of physical…

A: Internal controls mean to control the internal activities of the company. the internal control is…

Q: The audit objective that all journal entries were included in the financial statements is related to…

A: These assertions are made by the management. These are the claims regarding certain aspects of the…

Q: 1. When auditing a manufacturing concern, what major inquiries might be made by the auditor about…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: An auditor selected items for test counts while observing a client’s physical inventory. The auditor…

A: Management assertion: Management assertion refers to the claim made by the management assuring about…

Q: 1) Internal auditing is going to be performing an assurance engagement dealing with controls over…

A: Assurance Engagement Assurance engagement which was conducted by the internal auditors to get the…

Q: When inventory items have price movements in excess of 50% (considered material), how does this…

A: As per AICPA, "Inherent risk is the risk of material misstatement assuming no related controls,…

Q: Listed in the table below are some common audit procedures. For each procedure below: Identify…

A: An audit of financial statements is an examination conducted by an independent auditor on the…

Q: Which of the following timing of inventory count is the best based on the auditor’s point of view…

A: Answer: Concept Control risk               Control risk means risk that the internal control…

Q: goal of this substantive audit procedure

A: Option b is wrong because for determining the proper recording of purchases, there is no need to…

Q: An auditor often tries to acquire background knowledge of theclient’s industry as an aid to audit…

A: Given: The gaining of knowledge by the auditor in differentiating obsolete and current inventory.

Q: When evaluating inventory controls, an auditor would be least likely toa. Inspect documents.b. Make…

A: Auditing:   In auditing, auditors verify the correctness and fair presentation of financial…

Q: document that the auditor would test would mostly likely be the? A. Supplier Invoice B. Purchase…

A: To  verify whether all goods received by the company have been recorded appropriately, the source…

Q: By conducting which steps, the auditor can obtain sufficient and appropriate audit evidence…

A: Sometimes due to the nature of Business sometimes the inventory held by the business is under the…

Q: How could the auditors have determined that the inventory balance was materially misstated? What…

A: Auditor is the independent qualified personnel who is a professional certified CPA. Auditor is…

Q: An auditor selected items for test counts from the client’s warehouse during the physical inventory…

A: Definition: Management assertion: Management assertion refers to the claim made by the management…

Q: the auditor picks an item of inventory from the warehouse and determines whether it is included in…

A: Management assertions are the claims made by executives regarding certain aspects of a business. The…

Q: Before the physical examination, the auditor obtains a copy of theclient’s inventory instructions…

A: Auditing: Auditing refers to an independent examination of financial information of any…

Q: Assuming that the auditor properly documents receiving reportnumbers as a part of the physical…

A: Cut off procedures are those procedures in which the departments in the business would have their…

Q: During the audit of a large manufacturing company, the auditor did not observe all locations of…

A: Unqualified and standard wording.

Q: How does inventory control deficiencies affect the development of audit procedures for inventories

A: Answer: The audit procedures are to be designed such that the total audit evidences can be…

Q: As the auditor of Sample Limited you note the following matters relating to the internal control of…

A: Internal control is a system of organizing the company in which a set of rules, policies, and…

Q: internal control of its sales

A: Internal control system is a set of rules and activities to be adhered during the conduct of…

Q: An auditor discovered the following errors and irregularities while performing tests of controls:…

A: 1. An effective internal control system for inventory will include all procedures and actions that…

Audit Procedures

Audit Procedures are methods and techniques performed by the auditor to determine the quality of financial information of clients, thereby expressing an opinion on true & fair view of financial statements and entity position. They are identified and applied at the planning stage of audit after determining audit objectives, scope, approach, and risk assessment.