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It is 1 July 20X5. Purrfect Co manufactures and sells a variety of food for dogs and cats. Your rm, Kirano & Co, has audited

It is 1 July 20X5. Purrfect Co manufactures and sells a variety of food for dogs and cats. Your rm, Kirano & Co, has audited the company for a number of years. You are about to commence the nal audit for the year ended 31 March 20X5 and the draft financial statements show prot before tax of $23.1 m and total assets of $99.2m. Vego Dog - inventory valuation Purrfect Co launched a new brand of vegan dog food, Vego Dog, in December 20X4 but sales have been lower than expected and the directors are considering a discounted sales price. Vego Dog products are valued using a standard costing method and the standard cost comprises raw materials, labour costs and production overheads. As at 31 March 20X5, Vego Dog products with a standard cost of $2.4m were included as nished goods in inventory. Receivable - Ellah Co One of Purrfect Cos major customers, Ellah Co, operates a chain of pet stores with 23 stores across the country. There have been reports in the press for several months that Ellah Co's sales and profits have been falling and, in March 20X5, Ellah Co announced that 11 of its stores were to close in May 20X5. As at 31 March 20X5, Purrfect Cos trade receivables included $2.6m outstanding from Ellah Co and no allowance has been included for this balance at the year end. Contamination - legal claims On 25 February 20X5, it was discovered that a batch of canned cat food had been contaminated with insecticide, which could be harmful to cats. This batch had been dispatched in November 20X4 to 247 retail stores. By 31 March 20X5, Purrfect Co had received legal claims totalling $1.9m from consumers whose cats had eaten the contaminated food. Describe any 4 (Four) substantive procedures the auditor should perform to obtain sufficient and appropriate audit evidence in relation to the matters identified regarding the inventory valuation of Polobalancing Dog products.

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