An auditor who wished to test for the existence or occurrence of inventory would most likely select a sample of inventory items from the perpetual records and
A)trace additions to the general ledger.
B)vouch additions to receiving reports.
C)vouch additions to sales invoices.
D)trace receipts to receiving reports.

Question

Quizplus · Accepted Answer

Vouching additions to receiving reports is a method used by auditors to test for the existence or occurrence of inventory. It involves selecting a sample of inventory items from the perpetual records and then verifying these items by checking against the receiving reports to ensure that the inventory was actually received and exists.

An Auditor Who Wished to Test for the Existence or Occurrence