Auditor tests of the physical controls over raw materials, work in process, and finished goods are generally limited to
A) observation and confirmation.
B) observation and inquiry.
C) inquiry and reconciliation.
D) observation and reconciliation.

Question

Quizplus · Accepted Answer

Auditor tests of physical controls over inventory typically involve observation and inquiry. Observation allows the auditor to visually confirm the existence and condition of the inventory, while inquiry involves asking knowledgeable personnel about inventory controls and procedures.

Auditor Tests of the Physical Controls Over Raw Materials, Work