Question: Your audit client's inventories on hand represent a significant portion of current assets. The inventories consist of thousands of items that have values from $10

Your audit client's inventories on hand represent a significant portion of current assets. The inventories consist of thousands of items that have values from $10 to $1,000. The merchandise items change according to the season and the promotional theme adopted by the stores' management for the year.The company has to pay the suppliers substantial deposits upon placement of these special orders.Merchandise is ordered up to three months in advance from overseas suppliers.

Identify and explain the accounts that are at risk of material misstatement.

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