Question 5. Amaroo Pty Limitedaudit sampling (4%)

Amaroo Pty Limited is a retailer of computer equipment. It carries approximately 250 stock lines, with individual items ranging in value from $1 to $25,000. Approximately 25% of the year-end stock is expected to be held at the company's central warehouse with the remainder spread evenly across 7 retail outlets. A full stocktake will be carried out at all locations at year-end. The inventory system produces the following reports:

• Complete stock listing showing: stock code, total quantity held, cost per unit, total cost per stock item. The stock listing also gives a breakdown of where the stock items are held by location and the total value of stock held at each location.
• Ageing report of all stock lines showing: stock code, total quantity held, sales quantity over each of the past three months, monthly purchase details

In addition, the system produces a stock sheet report for each location which lists a description and the stock code of each item held at that location pet the perpetual records. Quantities are not included, as these are completed by the count teams.

Required

With reference to the information above:

1. Identify the population from which samples must be selected to satisfy the existence and completeness assertions respectively.
2. Describe how MCA should select samples to test the existence and completeness assertions at each location. Which assertion should more attention be paid to and why?
3. List two CAATs that could be used to help gather the evidence, including at least one feature of Active Data for Excel.