Question

Which of the following is not a reason for the special significance attached by the to auditor ot the verification of inventories ?

A. The determination of inventory valuation directly affects net income.
B. There is not enough evidence available for auditing inventory
C. Special valuation problems often exist for unusual types of inventories.
D. Inventories are often the largest current asset of an enterprise.

Answer 1

The correct answer is B. There is not enough evidence available for auditing inventory.

Step-by-step explanation:

The correct answer is B. There is not enough evidence available for auditing inventory.

Auditing inventory is of special significance to auditors because inventory valuation directly affects net income, making option A incorrect. Option C is also incorrect because special valuation problems can indeed exist for unusual types of inventories. Additionally, option D is not correct because inventories are often the largest current asset of an enterprise. Therefore, the answer is B, as the availability of evidence does not influence the significance attached by auditors to the verification of inventories.