*This course is formerly known as ADT129: Audit of Inventories.

Programme Objective
 
To provide audit professional with guidance on the audit of inventories. This course will also cover the key financial statement reporting and disclosure requirements for inventories. Recent ACRA PMP observations related to inventories will also be discussed.

Programme Outline

• Understand the key audit concepts and requirements for inventories
• Identify and assess the risks of material misstatement
  • Inherent risk
  • Fraud risk
  • Control risk
• Revised FRS 2, AGS 4, SSA 501 requirements with practical examples and case studies
• Determine the extent of reliance to place on internal controls over inventories; plan the nature, extent and timing of tests of controls; conduct and evaluate the results of these tests of controls and assess their implications for planning substantive tests of inventories. Practical examples will be used to illustrate and discuss the following: 
  • Physical inventory count observation
  • Perpetual, periodic and cycle count
  • Common audit issues in relation to roll forward and backward
• Plan the nature, extent and timing of substantive tests for various assertions related to inventories. Practical examples will be used to illustrate and discuss the following:  
  • Analytical procedures
  • Measurement of inventories
    • NRV test and allowance for inventory obsolescence
    • Common audit issues in relation to FIFO, weighted average and specific identification method
    • Standard costing vs retail method
  • Good on consignment
  • Goods in transit
  • Inventories at third party warehouse
  • Test of raw material, work-in-progress and finished goods
• Evaluate the audit findings and draw appropriate audit conclusion for inventories. Practical examples on how to substantiate and challenge audit findings in an engagement will be discussed.
• Understand the key financial statement reporting and disclosure requirements for inventories.
• Discuss common inventory fraud schemes and related controls to prevent fraud in inventories.
• Discuss ACRA PMP observations from 2007 to 2023 related to inventories.

 
Training Methodology
 
A Foundation to Intermediate level programme intended for Practising and Non-Practising Accountants and Auditors. Senior Audit Professionals who like to understand more about the issues involved in the audit of inventories are welcome to attend.
 
Closing Date for Registration

1 week before programme or until full enrolment
 

Intended For

A Foundation to Intermediate level programme intended for Practising and Non-Practising Accountants and Auditors. Senior Audit Professionals who like to understand more about the issues involved in the audit of inventories are welcome to attend.

Programme Facilitator(s)