Auditors often observe the counting of their clients inventories. You are working in the area of inventory
Question:
Statement
a. With strong internal control, may Jilco Inc.’s inventory count be performed during the year rather than at year end?
b. Jilco Inc. has inventory at many locations. Do we need to be present for the count at all locations?
c. Must I document all my test counts in the working papers?
d. Am I correct that our observation of the counting of the inventory primarily addresses the existence of inventory, and not the completeness of the count?
e. Is it correct that, since Jilco Inc. manufactures a product, direct labor and overhead ordinarily become a part of inventory costs?
f. Should Jilco’s inventory be valued at the lower of standard cost or market?
g. Is it safe to assume that any inventory items present as “consigned in” should not be included in the clients’ inventory?
h. When I take test counts of items, does this eliminate the need for Jilco Inc. personnel to count those items?
i. Do I need to count all items in the inventory?
j. At the completion of the count, should I leave Jilco Inc. personnel with a copy of all my inventory test counts to help assure inventory accuracy?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Principles of Auditing and Other Assurance Services
ISBN: 978-0078025617
19th edition
Authors: Ray Whittington, Kurt Pany
Question Posted: