The Case of an Audit of the Cycle of Inventories Rate and Cost of Sales, Executed Within a Risk-Based Approach

Abstract

This didactic contribution aims to provide the teaching of a comprehensive case for the execution of arisk-based audit  in the cycle of Inventories and Cost of Sales.

One of the main disadvantages of the Audit Standards with respect to the Accounting Standards is the lack of practical cases that capture the execution of the audit process in its entirety: its planning, execution, sampling, documentation and how the auditor concludes  based on the evidence obtained.

The reader of this article will have the step-by-step development of the process of a risk-based audit in the cycle of Inventories  and Cost of Sales, the identification of its stages, all with a 100% practical approach.

It is also intended to provide a case study that renders the methodology and raises awareness of the importance of documenting the work done.

And finally, the reader will be able to understand and conclude, in the light of the results obtained, about the importance and advantages of the selected approach compare to the traditional one.