Shelly's Bank has loaned money to Pete's Auto Supply.The loan is collateralized by inventory.The loan also requires a CPA to observe the count of the inventory and trace sampled items to the vendor invoices in order to determine the value of inventory is not misstated.This service would be
A)an assurance service engagement.
B)an attestation engagement.
C)a review engagement.
D)a compilation engagement.

Question

Quizplus · Accepted Answer

This service is an attestation engagement because a CPA is providing assurance on the accuracy of the inventory values through observation and tracing of vendor invoices.

Shelly's Bank Has Loaned Money to Pete's Auto Supply