An auditor most likely would make inquiries of production and sales personnel concerning possible obsolete or slow-moving inventory to support management's financial statement (PCAOB)assertion of
A)Valuation or allocation.
B)Rights and obligations.
C)Existence or occurrence.
D)Presentation and disclosure.

Question

Quizplus · Accepted Answer

The PCAOB assertion of valuation or allocation pertains to whether the company's inventory has been recorded at a proper value in the financial statements, and whether the allocation of inventory costs to expenses is appropriate. Inquiries regarding possible obsolete or slow-moving inventory by the auditor are necessary to determine the correct valuation of inventory and its allocation to ensure accuracy in the financial statements.

An Auditor Most Likely Would Make Inquiries of Production and Sales