MT Hood presentation - 490 Assurance Services Click to edit...

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Click to edit Master subtitle style 2/21/11 Mt. hood furniture 490 Assurance Services Test of Accuracy of the Final Inventory Compilation
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2/21/11 Audit Objectives What? To determine the value of Mt. Hood Furniture inventory based on a sample rather than counting the entire population To obtain reasonable assurance that inventory assertion is presented fairly in all material respects
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2/21/11 Determination of sample size Population and Sampling Unit - the sampling unit in PPS sampling is the individual dollar, and the population is considered a number of n =(BV x RF)/(TM-(AM x EF) BV = 6,753,764.00 RF = 1 TM = 325,000 AM = 100,000 EF = 1.15 (6,753,764 x 1)/325,000-(100,000 x 1.15)
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2/21/11 Incorrect acceptance at 37% Incorrect Acceptance at 37% Reliability Factor
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2/21/11 PPS sample selection BV × RF n = ———————— TM – ( AM × EF )
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2/21/11 Mt. Hood Furniture inventory is $6,753,764 Tolerable misstatement is 325,000 Anticipated misstatement is 100,000
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This note was uploaded on 02/20/2011 for the course ACCOUNTING ACC490 taught by Professor Friedel during the Spring '11 term at University of Phoenix.

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MT Hood presentation - 490 Assurance Services Click to edit...

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