Audit Evidence: PP&E

Question 1

In testing plant and equipment balances, an auditor may inspect new additions listed on the analysis of plant and equipment. This procedure is designed to obtain evidence concerning management’s assertions of:

Answer 1

Existence

Question 2

An auditor concluded that no excessive costs for idle plant were charged to inventory. This conclusion most likely related to the auditor’s objective to obtain evidence about the financial statement assertions regarding inventory, including understandability and classification, and

Answer 2

Valuation and allocation.