A client maintains perpetual inventory records in quantities and in dollars. If the assessed control risk is high, an auditor would probably
A)apply gross profit tests to ascertain the reasonableness of the physical counts.
B)increase the extent of tests of controls relevant to the inventory cycle.
C)request the client to schedule the physical inventory count at the end of the year.
D)insist that the client perform physical counts of inventory items several times during the year.

Question

Quizplus · Accepted Answer

When control risk is assessed as high, the auditor would likely request the client to schedule the physical inventory count at the end of the year to ensure the accuracy and completeness of the inventory records.

A Client Maintains Perpetual Inventory Records in Quantities and in Dollars