Identify and explain the assertions that the auditor will check by performing the following audit procedures- (i) Employee benefit expenses do not…

(i) For Employee benefit expenses do not include the cost of any unauthorised personnel: The auditor will check the occurrence assertion for the same to ensure that transactions recognised in the financial statements have occurred and relate to the entity. (ii) All the items of inventory pertaining to the relevant year shall be included regardless of the location: The auditor will check the cut-off assertion to ensure that all assets and liabilities are reported in the appropriate period. (iii) Sales are recorded correctly in the books based on the invoices. Discounts have been properly adjusted or accounted for: The auditor will check measurement assertion to ensure transactions have been recorded accurately at their appropriate amounts in the financial statements. There have been no errors while preparing documents or in posting transactions to ledger. The figures and explanations are not misstated. (iv) The entity owns or controls the inventory recorded in the financial statements. i.e., the purchase invoices have been made in the name of the client: The auditor will check rights & obligations assertion to ensure that the entity has the right to assets (i.e. whether the entity has ownership and legal title to assets), and the liabilities recognised in the financial statements represent all the entity's obligations to repayment as at a given date. (v) Inventory has been recognised at the lower of cost and net realizable value in accordance with AS 2 - Inventories: The auditor will check valuation assertion to ensure assets, liabilities and equity balances have been valued appropriately i.e. the amounts at which they are recorded are appropriate. There has been no overstatement or understatement