David, an experienced auditor, is assigned to conduct the audit of a continuing client, Eco Fabrics Ltd. To comply with the auditing standard 'ASA500 Audit Evidence', David is planning the following specific procedures:  

 

Procedures
1)	Calculating and analyzing the inventory turnover ratio by comparing the cost of goods sold to the average inventory balance during the year.
2)	Sending confirmations to a sample of Eco Fabrics' customers to verify the outstanding accounts receivable balances.
3)	Physically observing a selection of significant assets, such as machinery, equipment, or vehicles.
4)	Examining contracts and agreements with suppliers to ensure that the terms and conditions of purchase orders are accurately reflected in the financial statements.
5)	Confirming the year-end bank balances by directly communicating with Eco Fabrics' banks.

 

Required: write your answer to both Part A and Part B in the space provided below

Part A

For each procedure listed in the table above, indicate the type of evidence-gathering procedure it represents. 

Part B

For each audit procedure listed in the table, indicate one specific account balance that is at risk and a key assertion for the account balance that is likely to be affected with a brief explanation.