151
Chapter 15
Audit Sampling for Tests of Controls and
Substantive Tests of Transactions
UIstop
Review Questions
151
A representative sample is one in which the characteristics of interest for
the
sample
are
approximately
the
same
as
for
the population (that is, the sample accurately represents the total population). If
the population contains significant misstatements, but the sample is practically
free of misstatements, the sample is nonrepresentative, which is likely to result in
an improper audit decision. The auditor can never know for sure whether he or
she has a representative sample because the entire population is ordinarily not
tested, but certain things, such as the use of random selection, can increase the
likelihood of a representative sample.
152
Statistical sampling is the use of mathematical measurement techniques
to calculate formal statistical results. The auditor therefore quantifies sampling
risk when statistical sampling is used. In nonstatistical sampling, the auditor does
not quantify sampling risk. Instead, conclusions are reached about populations
on a more judgmental basis.
For both statistical and nonstatistical methods, the three main parts are:
1.
Plan the sample
2.
Select the sample and perform the tests
3.
Evaluate the results
153
In replacement sampling, an element in the population can be included in
the sample more than once if the random number corresponding to that element
is selected more than once. In nonreplacement sampling, an element can be
included only once. If the random number corresponding to an element is
selected more than once, it is simply treated as a discard the second time.
Although both selection approaches are consistent with sound statistical theory,
auditors rarely use replacement sampling; it seems more intuitively satisfying to
auditors to include an item only once.
154
A simple random sample is one in which every possible combination of
elements in the population has an equal chance of selection. Two methods of
simple random selection are use of a random number table, and use of the
computer to generate random numbers. Auditors most often use the computer to
generate random numbers because it saves time, reduces the likelihood of error,
and provides automatic documentation of the sample selected.
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155
In systematic sampling, the auditor calculates an interval and then
methodically selects the items for the sample based on the size of the interval.
The interval is set by dividing the population size by the number of sample items
desired.
To select 35 numbers from a population of 1,750, the auditor divides 35
into 1,750 and gets an interval of 50. He or she then selects a random number
between 0 and 49. Assume the auditor chooses 17. The first item is the number
17. The next is 67, then 117, 167, and so on.
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 Spring '10
 Mohammad

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