Auditing and Assurance Standards and Guidance

Auditing Standards (Ireland)

FRC ISAs (UK and Ireland) applicable for periods beginning on or after 15 December 2010 but before 17 June 2016

ISA (UK and Ireland) 501 Audit evidence - specific considerations for selected items

Application and Other Explanatory Material

Inventory

Attendance at Physical Inventory Counting (Ref: Para. 4(a) )

Evaluate Management's Instructions and Procedures (Ref: Para. 4(a)(i) )

A4.	Matters relevant in evaluating management's instructions and procedures for recording and controlling the physical inventory counting include whether they address, for example:

The application of appropriate control activities, for example, collection of used physical inventory count records, accounting for unused physical inventory count records, and count and re-count procedures.

The accurate identification of the stage of completion of work in progress, of slow moving, obsolete or damaged items and of inventory owned by a third party, for example, on consignment.

The procedures used to estimate physical quantities, where applicable, such as may be needed in estimating the physical quantity of a coal pile.

Control over the movement of inventory between areas and the shipping and receipt of inventory before and after the cutoff date.