Which of the following audit procedures would provide the least reliable evidence that the entity has legal title to inventories?
A) Confirmation of inventories at locations outside the entity's facilities.
B) Analytical review of inventory balances compared to purchasing and sales activities.
C) Observation of physical inventory counts.
D) Examination of paid vendors' invoices.

Question

Quizplus · Accepted Answer

Analytical review of inventory balances compared to purchasing and sales activities provides indirect evidence and is less reliable for confirming legal title to inventories compared to direct evidence like examination of invoices or physical observation.

Which of the Following Audit Procedures Would Provide the Least