In auditing inventories, a major objective relates to the existence assertion.  Of the following audit procedures relating to inventories, which does not support the existence assertion?Select one:a.The auditor observes the client's inventory and performs test counts as appropriate.b.The auditor performs a lower of cost or market test for major categories of inventory.c.The auditor reviews the client's inventory-taking instructions for such matters as proper arrangement of goods, separation of consigned goods, and limits on movements of goods during inventory.d.The auditor confirms inventories not on the premises.

Which of the following audit objectives does not relate primarily to the financial report assertion of completeness?  Group of answer choicesInventory quantities include all products, materials and supplies owned by the company that are in transit.Inventory quantities include all products, materials and supplies on hand.Inventories are reduced when appropriate to net realisable value.The totals of inventory listings are properly included in the inventory accounts

Which of the following audit objectives relates primarily to the financial report assertion of classification?  Group of answer choicesInventory quantities include all products, materials and supplies owned by the company that are in transit.Inventories are included in the statement of financial position as current assets.Inventories exclude items billed to customers or owned by others.Inventories are included in the statement of financial position at the lower of cost and net realisable value. Previous

An audit program for inventory includes the following procedure:“Test count a sample of physical inventory and agree to management’s count records.”"Observe the arrangements of the client's management before the inventory count."&nbsp;"Select goods received notes for a few days before the count date and confirm that they are recorded and existed as "goods in" in inventory records. The corresponding goods should be included in the purchase in trade payables.""Obtain written representations concerning the completeness and accuracy of the physical count and valuation."Which of the above procedure is not included at the time of attending the physical stock take.<br /> A. a. 2 <br />B. b. 4 <br />C. c. 3 <br />D. d. 1

Use the accompanying solution sheet to reply to the eight situations below that relate to the audit of financial statements of nonpublic companies. Unless indicated otherwise, assume that material amounts are involved. Do not consider including an emphasis-of-matter paragraph in an "auditor discretionary" circumstance. Situations: A company has departed from GAAP. A company's inventory records were deficient and the auditor was required to satisfy herself that the inventory was properly stated using alternative procedures. She is satisfied that she has sufficient appropriate evidence. In auditing a client, an auditor has determined that substantial doubt exists about an entity's ability to continue as a going concern. A group auditor decides not to take responsibility for the work of the component auditor who audited a 70% owned subsidiary and issued an unmodified opinion. The total assets and revenues of the subsidiary are 5% and 8%, respectively, of the total assets and revenues of the entity being audited. A company changes from FIFO to LIFO for inventory valuation and the auditor concurs with the change. The change has a material effect on the comparability of the entity's financial statements this year, but is expected to have an immaterial effect in the future. Inadequate record retention policies by the client have resulted in a situation in which a CPA is unable to obtain sufficient appropriate audit evidence with respect to a material account. A CPA has decided to emphasize in the audit report that the company she audited is a component of XYZ Company, its parent. A client has changed its estimate of likely doubtful accounts from 2% of credit sales to 3%. The auditor believes the change to be reasonable. Reply as to the type of opinion and other modification to the audit report as follows: A. Adverse D. Disclaimer Q. Qualified U. Unmodified Other Modification EOM Add an emphasis-of-matter paragraph. OM Add an other-matter paragraph. BFM Add a basis for modification paragraph. OTHER Make modifications other than adding an additional paragraph. NONE Make no modifications. If more than one type of opinion is appropriate list each—one with "Report 1" and one with "Report 2." If only "Report 1" is appropriate, place an X in the "Report 2" Opinion Type cell, which indicates no second type of report is appropriate. Situation Opinion Type Other Modification BEM BEM NONE 1 A U 2 X EOM 3 D BEM OTHER U 4 Report 1 Report 2 Report 1 Report 2 Re I Don't Know If My Answers Are Correc

Analytical procedures used in planning an audit should focus onSelect one:a.Providing assurance that potential material misstatements will be identified.b.Assessing the adequacy of the available evidential matter.c.Enhancing the auditor's understanding of the client's business.d.Reducing the scope of tests of controls and substantive tests.