Name of Client: VIBES (SINGAPORE) PTE LTD Audit period: 1 January 20XX to 31 December 20XX Area: Inventory Cycle

Ref: I-1/1
Objective To ensure that inventories are counted accurately during the stock-take and compiled properly into the Inventory Listing. Work Done

Perform test counts of all inventory items and compare them to Inventory Tags during
the stock-take.

Trace these inventory items counted to Inventory Listing during the final audit.
TUAS Warehouse Location Section A1 Description

Micro Hi-Fi Micro Hi-Fi

Quantity 2

Tag No

2 8

Section A2

Comments Tag was counted by TC, supposed to be counted in pairs Quantity counted is different from inventory listing. No comment on Inventory Tag 8 Boxes are green and dusty, moldy; store man Mr TC says stocks in section B1 has been around for ages.
B2 ONE TV IS CRACKED,

@ # #@

Section A3 Section B1

Micro Hi-Fi 'B/d - TV

4 2

6 7

#@ # #@ #@ #@

Section B2 Section B3 Section B4

TV TV TV

3 4 4

4 9 3

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Section C1 Section C2

DVD PLAYER DVD PLAYER

2 4

5 1

#@

Must be counted by warehouse man inventory show one quantity of micro while in record is 2 Poor physical condition, perpetual: no movement during the year, has been brought down (obselesccene stock) Broken tv There was movement take place stock count control witness It was 0 10 inventory, but in warehouse, its about 10 Broken printer, in e2, verified that everything is in good condition, for final it should be one less yellow Inventory tag at tuas is 9, but began at 11 Series number all the same Section B The external auditor makes test counts of inventory quantities during a stock take to satisfy himself that an accurate count is being made by the individuals performing the stock take. By cross checking sample inventory quantities in the inventory ledger against the physical count and vice versa. The auditor is able to ascertain whether the dual objectives of exidence and completeness have been adequately met The test counts recorded by auditor are also used for the purpose of subsequent comparison with the clients compilation

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Name of Client: VIBES (SINGAPORE) PTE LTD Audit period: 1 January 20XX to 31 December 20XX Area: Inventory Cycle Ref: I-1/2

CHANGI Warehouse Location Section D1 Section D2 Section E1 Section E2 Section E3 Section E4 Section F1 Section F2 Section F3 Description Desktop Desktop Printer Printer Printer Printer Laptop Laptop Laptop Quantity 10 10 3 2 1 5 3 4 2 Tag No

Comments
Shrink-wrapped and already for delivery

12 18 16 17 14 19 13 15 11

# #@ #@ @ #@ #@ #@ #@

One of the printers was damaged.

One of the laptop is missing.

Legend:

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Perform test counts inventory items and compared them to Inventory Tags Traced inventory items counted to Inventory Listing

Observations:

1. 2.

All the stocks have the same serial number, 2903. Stocks should be labeled with different serial numbers. There are slow-moving stocks in the Tuas Warehouse, Section B1, where boxes are green and dusty, moldy. Mr. TC, the store man said stocks in section B1 has been around for ages. However, this is not identified and recorded on inventory tag 7. Inventory tag 2 is counted by Mr. TC, the store man only. Stock counting should be carried out by at least two persons, one of whom is independent from storekeeping. There is an error made during compilation of Tuas inventory listing. According to inventory tag 8 and test counts done for Section A2, there should be 2 micro hi-fi systems. However, only 1 was recorded in inventory listing. According to inventory tag 4 and test counts done for Section B2, there should be 3 TV sets. However, only 2 were recorded in inventory listing. This could be due to human error.

3.

4.

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Name of Client: VIBES (SINGAPORE) PTE LTD Audit period: 1 January 20XX to 31 December 20XX Area: Inventory Cycle Ref: I-1/3 5.
There is a forklift moving around during the stock take. Mr. Sky, the store man of Changi warehouse, said, The stocks have already been counted wat. Stocks should not be moved around during stock take, to avoid confusion or double counting. Stocks in Section D1 of Changi Warehouse were shrink-wrapped and already for delivery, as told by Mr. Sky. The stocks are accurately counted and recorded however no comments were made on inventory tag 12 to show that the stocks belong to the client. Count tags are pre-numbered however inventory tag 10 was omitted. Tracing laptop counted at Section F1, Changi Warehouse, to inventory listing and inventory tag 13, one of the laptop is missing. This might be due to theft or human error by count staff. Comparing test counts of Section E2, Changi Warehouse, to inventory tag 17, damaged printer is not noted on inventory tag. Store man of Changi Warehouse, Mr. Sky, said, Dont have, dont have, when he was asked whether there is any damaged inventory. However, during the stock take, one of the printers at Section E2 was damaged. Mr. TC, store man of Tuas Warehouse said, We have cleared all the damaged goods two weeks ago. However, during the stock take, one of the televisions at Section B2 was damaged. This shows that Vibes (Singapore) Pte Ltd has a weak physical control over inventory due to incompetency of the store man. Conclusion: Assuming the satisfactory disposition of the reason for the discrepancy noted above, the audit objective as noted above has been met.

6.

7. 8.

9.

10.

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Completed by: Reviewed by: