An Auditor's Observation Procedures for Inventory May Be Performed During

question 10

Multiple Choice

An auditor's observation procedures for inventory may be performed during or after the end of the period under audit under which of the following conditions?

• A)When the client maintains periodic inventory records.
• B)When the auditor finds minimal variations in client records and test counts in prior periods.
• C)When total inventory has not varied more than 5% in the last five years.
• D)When well-kept perpetual inventory records are checked by the client periodically by comparisons with physical counts.

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Definitions:

Courteously

In a polite, respectful, and considerate manner, often reflecting goodwill and proper manners.

Handling Method

The techniques and processes used in the physical manipulation, movement, and storage of materials or products.

Sales Call

A communication, often in the form of a telephone call or face-to-face visit, initiated by a salesperson to a potential customer with the aim of making a sale.

Postpone

To delay or put off an event, action, or decision to a later time.