When an Auditor Observes That Personnel Who Are Responsible for Physically

question 24

Multiple Choice

When an auditor observes that personnel who are responsible for physically counting inventory are not following the inventory instructions, the auditor should

• A) contact a client's supervisor to correct the problem.
• B) modify the client's physical inventory instructions.
• C) not discuss the problem with client's supervisor in order to maintain independence.
• D) assign audit staff to the inventory count.

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Definitions:

General Rules

Foundational principles or guidelines designed to dictate behavior or regulate procedures in various contexts.

Memorandum of Understanding

A document outlining the preliminary agreements between two or more parties before the finalization of a contract.

Cursive Initials

Handwritten letters of a person's name executed in script as a form of identification or signature.

Ambiguities

Uncertainties or doubts in the meaning or interpretation of words, phrases, or legal provisions.