When Auditing Steel Ltd, a Large Manufacturer of Building Supplies

Multiple Choice

When auditing Steel Ltd, a large manufacturer of building supplies, which one of the following audit procedures would give the least assurance with regards to the valuation and allocation assertion for inventory?

A) Examining paid vendors' invoices.
B) Testing the computation of standard overhead rates.
C) Obtaining confirmation of inventories pledged under loan agreements.
D) Reviewing direct labour rates.