CPA AUDITING - STUDY UNIT 15 Evidence – Sampling: Core Concepts A. Audit sampling applies an audit procedure to fewer than 100% of the items under audit for the purpose of drawing an inference about a characteristic of the population. Sampling may be statistical or nonstatistical. 1. Statistical sampling is an objective method of determining sample size, selecting the items to be examined, auditing those items, and drawing an inference about the population. Its primary characteristic is random selection . It also provides a means of quantitatively assessing precision (how closely the sample represents the population) and reliability ( confidence level , the percentage of times the sample will adequately reflect the population). 2. Sampling risk is the probability that a properly drawn sample may not be representative of the population. It may be measured and controlled by statistical sampling. The auditor controls sampling risk by specifying the acceptable level when developing the sampling plan. 3.
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