(Aud Update) The Essential Role of Stocktaking in Auditing
(Aud Update) The Essential Role of Stocktaking in Auditing
Auditor Role In Stocktaking
As the financial year unfolds, auditors across the world engage in a crucial practice: stocktaking.
For many new or transferred clients unfamiliar with this procedure, questions often arise about its importance and necessity.
Stocktaking is not merely a routine task; it is a fundamental aspect of auditing that ensures the accuracy and integrity of a company’s financial statements.
This period of intense activity is not just about counting physical inventory; it’s a process deeply rooted in verifying the existence, condition, and valuation of assets.
ISA 501 Audit Evidence
ISA 501-"Audit Evidence—Specific Considerations for Selected Items," is the key standard guiding auditors on stocktake, or inventory counting.
It requires auditors to physically attend inventory counts to verify the existence and condition of inventory, unless it's impractical.
When direct attendance isn't possible, auditors must use alternative methods, like remote verification, to ensure the reliability of the inventory data.
Audit Opinion on Stocktake
If an #auditor is unable to obtain sufficient and appropriate audit evidence regarding the existence and completeness of inventory, whether by attending the stocktake or through alternative procedures, this could result in a limitation of scope in the audit opinion.
In some cases, if the impact is both material and pervasive, a disclaimer of the audit opinion may be necessary.
Happy Stocktaking! Happy New Year.
Visit Us
Wisma KTP, 53 Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru
Wisma THK, 41, Jalan Molek 1/8, Taman Molek, 81100 Johor Bahru
KTP (Audit, Tax, Advisory)
An approved audit firm and licensed tax firm operating under the KTP group based in Johor Bahru providing audit, tax planning, advisory and compliance services to clients
Website www.ktp.com.my
Instagram https://bit.ly/3jZuZuI
Linkedin https://bit.ly/3sapf4l
Telegram http://bit.ly/3ptmlpn
THK (Secretarial, Bookkeeping, Payroll, Advisory)
A licensed secretarial firm in Johor Bahru providing fast reliable incorporation, secretarial services, corporate compliance services, outsourcing bookkeeping, and payroll services to clients
Website www.thks.com.my
Facebook https://bit.ly/3nQ98rs
KTP Lifestyle
An internal community for our colleagues on work and leisure.
Tiktok http://bit.ly/3u9LR6Q
Youtube http://bit.ly/3ppmjyE
Facebook http://bit.ly/3ateoMz
Instagram https://bit.ly/3jZpKLo
KTP Career
An external job community on vacancies in Johor Bahru for interns, graduates & experienced candidates.
Instagram https://bit.ly/3u2PxHg
Facebook http://bit.ly/3rPxz9o