Question
The auditor in the Scott engagement has chosen to increase attention on the financial statement assertion of valuation. Procedures that might be used in an
The auditor in the Scott engagement has chosen to increase attention on the financial statement assertion of valuation. Procedures that might be used in an audit are listed below. From the following list, choose the two procedures that would be most appropriate to perform in an audit that is giving increased attention to the valuation assertion. Select "Yes" for only two procedures.
Observing the client count the physical inventory.
Testing shipping and receiving cutoff procedures.
Obtaining confirmation from lenders regarding inventories pledged under loan agreements.
Examining paid vendors' invoices.
Obtaining confirmation of inventories at locations outside the entity.
Examining an analysis of inventory turnover.
Tracing test counts recorded during the physical inventory observation to the inventory listing
Step by Step Solution
3.48 Rating (155 Votes )
There are 3 Steps involved in it
Step: 1
Interim and final audit procedures During the interim audit the system of internal control is documented and evaluated This will determine the mix of tests of control and substantive procedures but bo...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started