Consider the following information gathered by several auditors on the same engagement team performing an audit of the financial statements of a home improvement center.

Suppose the audit team gathered the following subtantive evidence when testing existence and valuation account:

- Of the 100 new locations under construction as of the balance sheet date, the audit team visit five sites on a random basis to inspect the reasonableness of the percentage of completion compared to the amount recorded. The auditors found for the five sites that records indicated that projects were, on average, one percent less completed in reality as compared to the recorded completion costs.

- Based on inspection of 20 randomly selected construction files (which represented 40 percent of the total balance), the audit team identified that total recorded costs for the projects were approximately two percent higher than the amount recorded for these sites.

- Based on review of the contracts included in each file, amounts are paid to the managing contractor on an ongoing basis, and the property belongs to the retailer, who hires the contractor to manage the project.

Based on this evidence, what conclusions can the auditor reach, if any, about the assertions associated with the construction-in-progress account?

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Business Process: Balance Sheet Account: Recorded Balance: Tolerable Misstatement: Site Selection and Development Construction-in-Progress $125 million $6 million