An auditor was appointed to the audit of BID Inc. (BID) subsequent to BID’s year-end date. BID is in the business of providing IT consulting services and is also a computer equipment reseller
An auditor was appointed to the audit of BID Inc. (BID) subsequent to BID’s year-end date. BID is in the business of providing IT consulting services and is also a computer equipment reseller. BID only orders inventory from the manufacturer once a customer has placed an order. This allows for BID to have low levels of inventory. As a result of being appointed to the audit subsequent to year end, the auditor was unable to attend the year-end inventory count and could not obtain sufficient and appropriate audit evidence for the inventory balance. In this circumstance, the auditor should issue a qualified opinion due to a scope limitation and the audit report should set out the nature of the modification in the auditor’s responsibility paragraphs.
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