Inventory Verification

Inventories normally constitute a significant portion of the total assets, particularly in the case of manufacturing and trading entities as well as some service rendering entities. 

Audit of inventories, therefore, assumes special importance. The advantage of inventory verification is helps in determining the correct value of the inventory.

Verification: It is the management’s responsibility for physical verification. In carrying out an audit of inventories, the auditor is particularly concerned with obtaining sufficient appropriate audit evidence to corroborate the management’s assertions