Auditors observe the client taking physical inventory at year-end primarily to obtain assurance about the value of inventory.

Question

Quizplus · Accepted Answer

Auditors observe physical inventory mainly to obtain evidence about the existence and valuation of inventory. By physically counting the inventory, auditors can determine if the physical count agrees with the accounting records, identify obsolete or damaged inventory, and ensure that inventory is accurately valued in the financial statements.

Auditors Observe the Client Taking Physical Inventory at Year-End Primarily