Inventory - and the Assertions

NotesQuiz

These are the main risks of misstatement for Inventory

Completeness Assertion

  • Not all stock owned is included in accounts

Existence Assertion

  • Not all stock included in accounts actually exists

Valuation Assertion

  • Stock is incorrectly valued
    • Due to incorrect cost allocation

    • Not valuing at NRV (if lower than cost)

Rights & Obligation Assertion

  • Not all inventory belongs to the client

Presentation and disclosure assertion

  • Inventory is incorrectly classified
NotesQuiz