The Auditor Determines That Each of the Following Objectives Will

question 10

Essay

The auditor determines that each of the following objectives will be part of your audit of Bozington,Co.,Inc.For each audit objective,select a substantive procedure that would help to achieve that objective.Each of the procedures may be used once,more than once,or not at all.
Audit Objective
1.Establish the completeness of inventories.
2.Establish the accuracy of cost amounts of inventories.
3.Determine that the presentation and disclosure of inventories and cost of goods sold is adequate.
4.Establish that the client has rights to the recorded inventories.
5.Establish the existence of ending inventory.
Substantive procedures
a.Examine current vendors' price lists.
b.Review drafts of the financial statements.
c.Select a sample of items during the physical inventory count and determine that they have been included on count sheets.
d.Select a sample of recorded items and examine supporting vendors' invoices and contracts.
e.Select a sample of recorded items on count sheets during the physical inventory count and determine that items are on hand.
f.Test the reasonableness of general and administrative labor rates.

---

Definitions:

Electronic Communication

The transfer of information or messages over digital platforms or devices, such as email or social media.

Baby Boom Generation

The demographic group born during the post-World War II baby boom, approximately between the years 1946 and 1964.

Born

The beginning of life or existence in a biological, metaphorical, or conceptual sense.

Cultural Context

The pattern of physical cues, environmental stimuli, and implicit understanding that convey meaning between two members of the same culture.