Albert David Supplies Ltd. have a large warehouse in Pune from which they supply their customers with over 1,000 chemicals and medicines purchased from numerous suppliers both in India and abroad. They do not maintain a continuous inventory of their stocks. At the year end, Tuesday, 31 March 2007, they wish to assess the stock physically.

Discussion 

a. Draw up full stock taking instructions for the stocktaking.
b. How should the stock be valued according to AS-2?
c How should the auditor seek evidence for the physical stock?