Contemporary Auditing 10th Edition by Michael Knapp

Exercise 73

Assume that you were a member of the Crazy Eddie audit team in 1986. You were assigned to test the client's year-end inventory cutoff procedures. You selected 30 invoices entered in the accounting records near year-end, 15 in the few days prior to the client's fiscal year-end, and 15 in the first few days of the New Year. Assume that client personnel were unable to locate 10 of these invoices. How should you and your superiors have responded to this situation Explain.