The following audit strategy would be most appropriate when an auditor has assessed that a substantive approach
Question:
The following audit strategy would be most appropriate when an auditor has assessed that a substantive approach is necessary to determine inventory quantity:
(a) inventory quantities determined by physical count at or within a few days of the end of the reporting period.
(b) inventory quantities determined by physical count near the end of the reporting period, adjusted by reference to perpetual records.
(c) inventory quantities determined by reference to perpetual records, without a physical count at or near the end of the reporting period.
(d) inventory quantities determined by reference to perpetual records, with a sample of inventory items counted at each month end throughout the reporting period.
Step by Step Answer:
Auditing A Practical Approach
ISBN: 9781118878415
1st Extended Canadian Edition
Authors: Robyn Moroney, Fiona Campbell, Jane Hamilton, Valerie Warren