Assertions

Management prepares the financial statements (FS) on basis of five assertions about each line item in the FS and auditor’s objective is to be sure that there are no material misstatements in these assertions.
Important point is that each line item in the financial statements contains all assertions. However, the risk of misstatement for each assertion will vary according to the type or materiality of an account. The auditor is more concerned about the higher risk assertions. For example:
1. Existence is a concern when auditing assets.
2. Completeness is a concern when auditing liabilities.
3. Occurrence is a concern when auditing sales.
4. Completeness is a concern when auditing expenses

Cutoffs are assertions mainly used for completeness and also for Rights and Obligation. That’s why while performing year end stock take auditor performs cut off procedure to check the completeness of inventory. So Inventory might be miscounted either accidentally or intentionally by client. Overcounting inflates currently reported earnings; undercounting reduces reported income. If overcounted, problem is with existence assertion. If undercounted, problem is with completeness assertion.
End-of-year cutoff could be recorded incorrectly in connection with receipt and shipment of inventory. Again, possible overstatement relates to existence assertion whereas understatement affects completeness assertion.
Inventory may include damaged or obsolete items so that recorded value must be reduced to net realizable value. This possibility relates to valuation assertion.

Hope the above ans your Q.