A is corrent because an auditor may be able to confirm the existence by obtaining direct confirmation in writing from the custodian.
B is incorrect because observation of the counting of that inventory may or may not be necessary based on the significance of the amounts involved, the owner’s procedures for investigating the warehouseman, and other factors.
C is incorrect because calculation will not address whether the goods are in the warehouse.
D is incorrect because while inspection of the inventory may be appropriate, it often will not be necessary.
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