Which of the following audit objectives relates primarily to the financial report assertion of presentation and disclosure-classification and understandability?
A)Inventories are included in the statement of financial position as current assets.
B)Inventories exclude items billed to customers or owned by others.
C)Inventories are included in the statement of financial position at the lower of cost and net realisable value.
D)Inventory quantities include all products, materials and supplies owned by the company that are in transit.

Question

Quizplus · Accepted Answer

The objective of presentation and disclosure-classification and understandability focuses on ensuring that financial statements are properly organized, classified and presented in a clear, understandable and informative manner. Option A specifically addresses the presentation of inventories in the statement of financial position, making it the most relevant objective. Options B, C and D relate to other financial statement assertions such as completeness, valuation and rights and obligations.

Which of the Following Audit Objectives Relates Primarily to the Financial