Markrich Sportsworld, Inc.

Initial
December 31, 19X2 Prepared by CH
Internal Control Questionnaire - Inventory Reviewed by

Yes No
Is there a policy for establishing economic order
1 √
quantities and reorder points?
Is merchandise counted and inspected before being
2 √
accepted from vendors?
Are merchandise receipts under blanket purchase
3
orders continuously monitored?
4 Are perpetual inventory records maintaned? √
Are there formal written instructions for physical
5 √
counts?
Are perpetual records periodically reconciled to
6 √
physical counts?
Are adjustments to inventory records documented
7 √
and approved?
Are shipping, inventory, and billing records
8 √
compared on a regular basis?
Are records maintained for inventory on
9 √
consignment in or consignment out?
Is an appropriate, consistent cost method used to
10 √
value transfers from inventory to cost of sales?
Are storage areas secure to preclude unauthorized
11 √
entry?
Are physical safeguards such as alarm systems and
12 √
security personnel adequate?
13 Are employees bonded? √
14 Is insurance coverage reviewed on a regular basis? √
Overall Conclusion : Based on the internal control questionnaire, the internal controls of Inventory is
SATISFIED
 Date
1-15-X3 D-2

Remarks

N/A; blanket order

not used

Client has only

consignments out

controls of Inventory is