From the auditors' point of view, inventory counts are more acceptable prior to the year end when
A)internal control is weak.
B)accurate perpetual inventory records are maintained.
C)inventory is slow moving.
D)significant amounts of inventory are held on a consignment basis.

Question

Quizplus · Accepted Answer

When accurate perpetual inventory records are maintained, it is easier for auditors to review and confirm inventory counts because they have a basis for comparison. This reduces the risk of misstatement in inventory balances and makes inventory counts more acceptable prior to year end. Weak internal control, slow-moving inventory, or consignment basis do not necessarily affect the acceptability of inventory counts prior to year end.

From the Auditors' Point of View, Inventory Counts Are More