ICAEW ARF · Chapter 7 · Question 4 of 11
During an inventory count, the auditor selects items on the warehouse floor and traces them to the final inventory listing. Which assertion is being tested?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Completeness
Explanation
Starting with the physical items and checking they appear in the records tests whether all inventory that exists has been recorded, which is completeness. Testing from the records to the floor would test existence. Ownership and accuracy require evidence such as purchase invoices and cost records.
More Assertions and audit evidence MCQs
- Q6An auditor obtains an official copy of the title register from HM Land Registry for a freehold property owned by a UK client. Which…
- Q7An auditor compares the cost of a sample of year-end inventory items with their selling prices after the year end. Which assertion is…
- Q8An auditor reviews the repairs and maintenance expense account for items that should have been capitalised as property, plant and…
- Q9Which of the following statements about written representations from management is correct?
- Q10An auditor finds that evidence from a customer confirmation is inconsistent with the client's records. What should the auditor do?