Question 18b ii - Specimen

Marking Guide

(ii) Substantive procedures for work in progress (WIP)
Discuss with management how the percentage completions are attributed to WIP 1
Observe the procedures carried out in the count in assessing the level of WIP;
consider reasonableness of the assumptions used 1
During the count, agree a sample of percentage completions are in accordance
with Vieri’s policies 1
Discuss with management the basis of the standard costs 1
Review the level of variances between standard and actual costs 1
Obtain a breakdown of the standard costs and agree a sample of these costs to
actual invoices 1
Cast the schedule of total WIP and agree to the trial balance and financial
statements 1
Agree sample of WIP assessed during the count to the WIP schedule, agree
percentage completion is correct and recalculate the inventory valuation 1
Restricted to 4