The Timing of a Physical Count of Inventory Is Negotiated

Multiple Choice

The timing of a physical count of inventory is negotiated between the auditor and management. If the assessed level of control risk is high, an auditor would probably

A) insist that the entity performs physical counts of inventory several times during the year.
B) apply gross profit tests to ascertain the reasonableness of the physical counts.
C) increase the extent of tests of control of the inventory cycle.
D) request the entity to schedule the physical count at the end of the year.