Final answer:
The statement is false; both auditors and clients can use statistical sampling to ascertain different aspects related to inventory and audit procedures, respectively.
Step-by-step explanation:
The statement "Auditors may use statistical sampling for their test counts, but the client should never use statistical sampling to estimate the quantities of goods on hand" is false. Both auditors and clients can make use of statistical sampling. Auditors use statistical sampling to determine the nature, timing, and extent of audit procedures.
Similarly, clients may use statistical sampling to estimate inventory quantities for internal purposes or financial reporting. Though auditors employ sampling techniques during their independent verification process, it does not preclude clients from using similar methodologies for estimating their inventory levels, under the guidance that such estimates are used responsibly and accurately reflected in financial statements.