An auditor usually traces the details of the test counts made during the observation of physical inventory counts to a final inventory compilation. This audit procedure is undertaken to provide evidence that items physically present and observed by the auditor at the time of thephysical inventory count area. Owned by the client.b. Not obsolete.c. Physically present at the time of the preparation of the final inventory schedule.d. Included in the final inventory schedule.

Q: How might an auditor use a client’s sales forecast for general familiarity with the production cycle…

A: Production Cycle:   The process that accounts the conversion of raw materials to work-in-progress…

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: Which of the following test controls most likely would help assure an auditor that goods shipped are…

A: In order to test the effectiveness of the control so as to detect the material misstatement, an…

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: If the auditor conducts test of the inventory controls at an interim date, is it appropriate to…

A: As a part of audit procedure test of controls are used to test the effectiveness of a control used…

Q: Why do auditors consider inventory errors pervasive?

A:

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: If an auditor performs a stocktake of the inventory of Station Ltd and selects items from the…

A: Auditing involves an independent examination of financial records of the entity with a view to…

Q: Which of the following automated application controls would offer reasonable assurancethat inventory…

A: Auditing is a gathering of information and evaluation of evidence as to report on the degree of…

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: When a company's financial statements are audited, the principal element an auditor reviews is the…

A: Audit is the process of verifying and examining the authenticity and accuracy of financial…

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: An auditor will most likely review an entity’s periodic accounting for the numerical sequence of…

A: Completeness represents that assets and liabilities are recorded and proper disclosure has been made…

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: When an audit team traces a sample of shipping documents to the related sales invoice copies, they…

A: Accounts Receivables: Accounts receivables are those accounts that occur due to incomes for which…

Q: 13-31

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

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: Which of the following audit procedures uses “a purchase transaction” as the sampling unit?   A.…

A: Audit Procedures for Purchase Transaction The proper audit procedures which are needed in the…

Q: An auditor is examining a nonpublic company’s inventory procurement system and has decided to…

A: Auditing is a gathering of information and evaluation of evidence as to report on the degree of…

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: 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: Indicate whether each of the following audit procedures is a testof controls, a substantive test, or…

A:

Q: onducting which of the following steps, the auditor can obtain sufficient and appropriate audit…

A: The sufficiency and appropriateness are the two components based on which the auditor decides on the…

Q: Which of the following best describes the reason that the auditors record their inventory test…

A: Working paper is the document prepared in the process of Audit. Working paper are prepared by…

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: Choose the one correct answer.  As part of your audit of a client's inventory balance, you created…

A: The question is related to Analytical Procedure and is related with test of details.

Q: The following are commonly performed tests of controls and substantive tests of transactions audit…

A: Audit procedures are steps taken by auditors to obtain all information regarding the quality of 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: 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: 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: 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: Which of the following auditing procedures probably would provide the most reliable evidence…

A: Trace test counts noted during the entity’s physical count to the entity’s summarization of…

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: At the completion of an inventory observation, the controllerrequested the auditor to give him a…

A: Given case is: At the completion of an inventory observation, the controller requested the auditor…

Q: In connection with the planning phase of an audit engagement, which of the following statements is…

A: Planning of Audit Engagement: An agreement between an auditor and a client in which the auditor…

Q: As part of your audit of a client’s inventory balance, you created an expectation of what should be…

A: SOLUTION- IF THE ESTIMATES MADE BY THE AUDITORS GIVES CONFUSING INVENTORY BALANCE , THE AUDITOR…

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: Which of the following audit procedures would an auditor most likely perform to test controls…

A: An auditor must check the shipping documents that have not been recorded in sale journal to conform…

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: 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…

Q: A typical substantive procedure for inventory balance and purchase transactions may include…

A: Should disclose separately in Financial statements and notes to accounts

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.