You are the graduate auditor working on your first client, Moo Ltd. Moo Ltd raises cattle and sell them for meat.

ACCT3101 Auditing and Public Practice

Case: Inventory Test Count

You are the graduate auditor working on your first client, Moo Ltd. Moo Ltd raises cattle and sell them for meat. Moo Ltd used to be farmer’s co-operative and was first incorporated in 2005. Since its incorporation, the company’s business has flourished. The financial is ended on 30 June 2019.

The tricky part of the audit is to test count the company’s inventory, cattle. As cattle keeps on moving, it is not easy to obtain an accurate count, even with help from drovers. Moo Ltd is interested in making the inventory count process more efficient and less stressful for the cattle. The client is also interested in improving the accuracy of the inventory data. As a result, this year the audit team deployed drones to take photos of the cows in the comfort of their own pens. The photos were taken on 3 July 2019, which is three days after the balance date.

Then you are assigned the task of count the number of cows using the Count Things software. To learn how to use Count Things please watch the video recording of Topic 4. Further instructions are in a separate document produced by Ernst & Young Foundation (modified for the case).

Cows can get sick from time to time. To avoid spreading infectious diseases from sick cows to the others, Moo Ltd generally relocates the sick cows to “special pens”, where they can receive treatment and recover. A track record of cattle movement in and out of “special pens” is called the special pen register.


The audit senior has asked you to 1) count the number of cows located in Pens #701 and #702 from the provided pictures using the Count Things software, 2) fill in your counts in the following inventory reconciliation form, and 3) advise if any follow-up procedure is needed to address any difference between the client’s count and your own count and 4) if such procedure is needed, describe the procedure(s).

Inventory Reconciliation-Cows

Pen NumberCount from Moo Ltd’s Inventory Ledger as at 30 June 2019 (1)Auditor’s Count from the pictures taken on 3 July 2019 (2)Initial Difference     (1)-(2)Follow-up audit procedures required? (Yes or No)Description of the follow-up procedure(s)?

Note: The software can be downloaded from Please login using the following credentials. Each student can install the software in one device only.

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