Question 5
ICAN
•
2022
•
AUDIT AND ASSURANCE
•
mixed
Case Stimulus
Garkuwa Nigeria Limited is a newly incorporated company that deals in building materials. The Managing Director is engaged on full time basis in the running of the business. Other employees are: the accounts officer who keeps the books, the cashier and two labourers. The company does not maintain inventory records and inventory is a material item in the financial statements. The Managing Director wants you to advise him on inventory count procedures with a view to ensuring that the methods used at arriving at the inventory value will be satisfactory. The first financial statements of the company are to be made up for the 12 months to December 31, 2021.
Requirements
(
a
)
Advise the Managing Director on how he should organise and carry out the physical inventory count.
(
b
)
State the records and information he should retain in connection with the count.
(
c
)
How should he arrive at the individual values for the various inventory items?
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About This Question
This is
Ican
2022
Audit And Assurance
Question 5.
It is one of the
mixed
questions from the
2022
Ican
Audit And Assurance
examination.