Auditor's Duties - Audit of Current Assets
The auditor's duties can be summarized as follows:
a) The accounting ascertaining policies adopted through the entity for pricing stocks;
b) Such as the guiding standard on stocks is IAS 2 inventories, so the auditor has to seem the appropriateness of the policies choose through the organization. You should notice that corresponding to IAS 2:
- The lower of cost and total realizable price is obligatory. A FIFO or weighted average price is used to assign prices.
- The cost would where suitable conclude a proportion of manufacture overheads where or not they vary on a time basis. The proportion concluded should be based upon the general level of activity.
- Whether identical models are purchased or made at different periods and hence have differing costs the technique of arriving at cost must be FIFO, weighted average
c) The auditor should test verify the stock sheets or the continuous stock records along with relevant documents that as costing and invoices records to check whether cost has been correctly arrived for.
d) The auditor must analysis and tests the treatment of overheads.
e) The auditor should test the examination and treatment the offered able evidence for models valued at total realizable price.
f) The auditor should check the arithmetical accuracy of the estimates made.
g) The auditor should check and confirm the consistency along with such the amounts have to be computed.
h) The auditor must seem the adequacy of the description utilized in the accounts and the accounting policies adopter's discolors.