Question

Should the inspection of securities on hand be coordinated with the verification of inventories because both involve counting and inspection and can conveniently be combined?

1) True
2) False

Answer 1

The inspection of securities on hand should be coordinated with the verification of inventories because both involve counting and inspection and can conveniently be combined.

Step-by-step explanation:

The inspection of securities on hand should be coordinated with the verification of inventories because both involve counting and inspection and can conveniently be combined.

When counting and inspecting inventories, it is important to also count and inspect the securities on hand to ensure accuracy and completeness. By combining these tasks, businesses can streamline their auditing processes and avoid potential errors or discrepancies.

For example, if a company has physical inventories of products as well as securities such as stocks or bonds, it would be efficient to count and inspect both at the same time. This way, any discrepancies or issues can be identified and resolved simultaneously, saving time and resources.