You determined that overall audit risk should be low say 5 For inherent risk you determined that it is high because inventory by its nature is subject to many types of misstatements Based on your understanding of the relevant transaction cycles you believed that internal control are effective Therefore you assess control risk as moderate before performing tests of controls Of course you also plan to use analytical procedures for tests of inventory These planned tests include comparing gross

Answer rating: 100% (QA)

Audit analysis for the FEP ltd It was necessary for the FEP Ltd to carry out an audit analysis by the use of the compliance or the reliance audit approach as it helps to give a comprehensive view of t... View the full answer