Reference no: EM132880945
Your firm is the auditor of Trent Textiles Ltd, and you are planning your audit work on the stock-take, which will be carried out at the firm's year-end of 31 May 2021.
Trent Textiles manufactures knitted garments, including pullovers. The production process comprises:
(a) Knitting the individual components (e.g., body and arms);
(b) Sewing the components together to form the finished garment;
(c) Cleaning, finishing, pressing and folding the garments;
(d) Packing the garments, ready for dispatch to the customer.
Trent Textiles does not have a perpetual inventory system, so the value of the stock in the accounts is found from the stock-take at the year-end. For management purposes, Trent Textiles carries out a full stock-take every three months. Your permanent file of the company confirms that it has a single factory and no internal audit department. You have been asked by the manager in charge of the audit to suggest the work you will perform at the stages listed above.
Questions.
a. State the work you will carry out prior to the commencement of the stock-take.
b. State the procedures you will check during the stock-take to ensure the company's staff have accurately recorded the stock.
c. State the work you will carry out and the matters you will record at the stock-take.9422
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