Confirmation of receivables and observation of inventories : (supersedes paragraphs 16-20 of chapter 6 and paragraphs 27-29 of chapter 10 of Statement on auditing procedure no. 33, and Statement on auditing procedure no. 36);

              STATEMENT ON AUDITING PROCEDURE
SEPTEMBER 1970
43
Confirmation of Receivables and Observation of Inventories
(Supersedes paragraphs 16-20 of Chapter 6 and paragraphs 27-29 of Chapter 10 of Statement on Auditing Procedure No. 33, and Statement on Auditing Procedure No. 36)
Purposes of This Statement
1. By vote of the Institute's membership in 1939 confirmation of receivables and observation of inventories were adopted as "generally accepted auditing procedures."1 The Committee reaf-firms the importance of these well-established auditing proced-ures and emphasizes that the independent auditor who issues an opinion when he has not employed them must bear in mind that he has the burden of justifying the opinion expressed.
2. The purposes of this Statement are to provide additional guidelines for the independent auditor in confirming receivables and observing inventories and to modify existing reporting re-quirements.2 This Statement relates only to confirmation of re-ceivables and observation of inventories and does not deal with
1 Confirmation of receivables and observation of inventories had been the subject of a report entitled "Extensions of Auditing Procedure" issued by a special committee.
2 The Executive Committee of the Institute by resolution on April 29-30, 1966 approved "the issuance of statements on auditing procedure which may modify or revise pronouncements on matters of auditing, previously approved by mem-bers at annual meetings as consistent with the authority granted to the Commit-tee on Auditing Procedure by the Council."
Issued by the Committee on Auditing Procedure American Institute of Certified Public Accountants
COPYRIGHT 1970 BY THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS, INC. 666 FIFTH AVENUE, NEW YORK, N. Y. 10019