L11 Notes_Part_4 - Terms Attribute Sampling TDR the...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Evidence: How Much? In general, to arrive at a positive outcome, the amount of evidence will increase if: 1. Materiality is low 2. Acceptable risk is low 3. Our expectation for problems is high
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Determining Sample Size When testing controls, use these terms 1. Materiality: T olerable D eviation R ate (TDR) , acceptable control deviation rate 2. Risk: A cceptable R isk of O verrelying on internal control (ARO), and 3. Expectation: E xpected D eviation R ate (EDR, estimated rate of errors suggested by a preliminary sample or last year’s workpapers).
Background image of page 2
Background image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Terms: Attribute Sampling TDR - the tolerable deviation rate is the maximum percentage of errors for which you would still rely on internal control, thus decreasing CR and increasing DR ARO - the acceptable risk of assessing control risk too low indicates the risk you will accept of relying on IC when you should not. Confidence level is the inverse (1-ARO) EDR - expected population deviation rate is your best estimate of the percentage of errors obtained from last year's W|P's or a preliminary sample...
View Full Document

This note was uploaded on 10/05/2011 for the course ACG 5637 taught by Professor Monikacaushoulli during the Fall '08 term at University of Florida.

Page1 / 3

L11 Notes_Part_4 - Terms Attribute Sampling TDR the...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online