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Hi,
I understand that the cut off assertion relates to transactions, not balances, but is inventory the exception? In a few past question, when asking what assertions to test in relation to inventory, cut-off appears in the answer as an option.
I realize that inventory is very much linked to sales and purchases, so is that why cut-off applies (if indeed it does)?
Thanks for your help.
I find the division of assertions into those to do with balances, transactions, and presentation and disclosure really unhelpful.
Cut-off in inventory can be related to rights and obligations. For example, is is not owned if it has been sold. If it is owned, then it must have been paid for or a liability must be set-up.
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