Page 147 - Microsoft Word - 00 IWB ACCA F7.docx

Procedures

Inventory

7.1 Key assertions

 Existence

 Valuation

 Completeness

 Rights and obligations

7.2 Sources of evidence

 Aged inventory listing

 Inventory

 Inventory count sheets

 Purchase invoices

 Goods received notes

 Sales invoices

 Goods despatch notes

 Client calculations of overhead allocation, absorption and apportionment

7.3 Key areas to consider

 Obsolescence

 Valuation rules

 Year-end cut-off issues

 Multiple locations

 Work in progress

143