Audit Procedures to Test Controls Over Inventory Records Could Include

question 20

Short Answer

Audit procedures to test controls over inventory records could include the procedures listed below. Match each of the procedures numbered 1 through 5 to the appropriate control objective (A through F) and place the identifying letter in the space provided.
A: Validity
B: Completeness
C: Authorization
D: Accuracy
E: Classification
F: Proper period
____ 1. Account for the integrity of the numerical sequence of shipping documents used to relieve stock from the inventory records.
____ 2. Examine material requisitions for evidence of approval by the production supervisor.
____ 3. Review the reconciliation of the daily summary of goods shipped per shipping bills to the daily summary of stock removed from inventory per the perpetual inventory records.
____ 4. Trace quantities shipped per shipping bills to the perpetual inventory records.
____ 5. Review material requisitions for evidence of internal verification of general ledger account numbers.

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Definitions:

Hands Free

Technology or devices that can be operated without the use of hands, often through voice commands or automation.

Eyes Free

Technology or systems designed to be used without the need for visual engagement, allowing users to focus their sight elsewhere.

Critical Data

Information that is essential to the operations or decision-making processes within an organization, often requiring protection due to its sensitivity or value.

Subject Area

A specific domain of knowledge or expertise.