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Friday, October 9, 2020 | History

2 edition of Statistical sampling in an audit context found in the catalog.

Statistical sampling in an audit context

Giles R. Meikle

Statistical sampling in an audit context

by Giles R. Meikle

  • 10 Want to read
  • 15 Currently reading

Published by Canadian Institute of Chartered Accountants in Toronto .
Written in English

    Subjects:
  • Auditing -- Statistical methods.,
  • Sampling (Statistics)

  • Edition Notes

    Bibliography: p. 43.

    Statement[by] Giles R. Meikle.
    SeriesAn Audit technique
    Classifications
    LC ClassificationsHF5667 .M45
    The Physical Object
    Pagination43 p.
    Number of Pages43
    ID Numbers
    Open LibraryOL5449304M
    LC Control Number73151242

    But, if you need a statistical estimate of the effect of uncertainty on the audit findings and audit conclusion, then a “statistical” sampling method will be selected. Statistical Before choosing a statistical sampling method, you should consider if the outcomes to be examined are attribute-based or variable-based. More on that later. Audit sampling is the use of an audit procedure on a selection of the items within an account balance or class of sampling method used should yield an equal probability that each unit in the sample could be selected. The intent behind doing so is to evaluate some aspect of the information.

    Sampling risk is one of the many types of risks an auditor may face when performing the necessary procedure of audit sampling. Audit sampling exists because of the impractical and costly effects of examining all or % of a client's records or books. As a result, a "sample" of a client's accounts are examined. Due to the negative effects produced by sampling risk, an auditor may have to perform . C. Selection of the sample D. Audit quality controls. A. Which of the following statistical sampling techniques is least desirable for use by the auditors? A. Random number table selection. The sample items have a mean book value of $ and a mean audited value of $ The book value in the population is $,

    If statistical sampling methods are used by the client in the taking of the physical inventory, the auditor must be satisfied that the sampling plan is reasonable and statistically valid, that it has been properly applied, and that the results are reasonable in the circumstances. The independent auditor may be asked to audit financial. Audit Sampling. The objective of statistical sampling in an audit context can be defined as follows: To employ random selection procedures and statistical evaluation techniques in representative testing (whether for compliance or substantive objectives) so as to eliminate the risk of bias and so as to permit quantification of the sampling confidence achieved wherever this greater objectivity.


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Statistical sampling in an audit context by Giles R. Meikle Download PDF EPUB FB2

Audit Sampling: An Introduction to Statistical Sampling in Auditing [Guy, Dan M., Carmichael, D. R., Whittington, O. Ray] on *FREE* shipping on qualifying offers. Audit Sampling: An Introduction to Statistical Sampling in AuditingCited by: 9. Statistical sampling in an audit context.

[Giles R Meikle] -- From the Foreword: Statisical sampling can no longer be called a new technique. It has been used by some auditing frims for many years and has appeared in auditing literature for many more years.

This book should be in every auditors library, as it demonstrates the terminology and methods to generate valid statistic samples for audit tests of controls. I have always been a big proponent of statistical sampling, as it makes dimensioning identified issues very easy.

This book explains the most effective ways to do by: 7. Designed from the perspective of financial auditing with emphasis on the use of sampling in the audit of financial statements by external as well as internal auditors. Presents technical sampling material within the context of the auditing risk model.

New to this edition: a chapter on nonstatistical sampling, coverage of sampling to test compliance with laws and regulations, SAS #55 on. The fifth edition of AUDIT SAMPLING continues to provide an important bridge between basic introductory auditing texts and the level of highly technical professional knowledge necessary to handle audit sampling applications in actual practice.

Written from the standpoint of internal and external auditors, the information is easy-to-understand by entry-level auditing students, yet also. "Auditing standards may be regarded as the underlying principles of auditing which control the nature and extent of the evidence to be obtained by auditing procedures." Actual requirements have been few but the American Institute of Accountants has gone along with the Securities and Exchange Commission in requiring an expression in the ac­.

Statistical audit sampling involves a sampling approach where the auditor utilizes statistical methods such as random sampling to select items to be verified. Random sampling is used when there are many items or transactions on record. Consider a company with more than inventory. an audit sample.

In a strict sense, the sample evaluation relates only to the likelihood that existing monetary misstatements or deviations from prescribed controls are proportionately included in the sample, not to the auditor's treat-ment of such items.

Thus, the choice of. An auditor selects a certain number of records to estimate how many times a specific feature will show up in a population. When using attribute sampling, the sampling unit is a single record or document — in this case, your single record is the customer invoice.

In order for the sample to be a “statistical" sample, the results must be evaluated and two calculations made. These calculations tell the user how likely it is that the sample results are within a given range of the actual population.

For instance, a statistical sample would not only tell you that disallowed deductions are estimated at $5, Statistical sampling generally may be applied to test internal control when the client's internal control procedures: A. Depend primarily on appropriate segregation of duties.

Are carefully reduced to writing and are included in client accounting manuals. Leave an audit trail. Statistic audit sampling is the sampling approach where auditor uses random sampling to select the items from the total population use the probabilities technique to measure the result of the testing and make a conclusion.

Using statistical sampling is very important to help the auditor to manage and control the audit’s risk. Audit Sampling AU-CSection Audit Sampling Source:SASNo Effective for audits of financial statements for periods ending on or afterDecember15, basis for conclusions about the this context,rep-resentativemeans that evaluation of the sample will result in.

Statistical sampling refers to an approach to sampling that has the following characteristics − Random selection of sample items, and The use of probability theory to evaluate sample results, including measurement of sampling risk. Sampling without the above characteristics is to be considered as a non-statistical approach.

In the audit context, there are generally two primary approaches to sampling: Statistical and Non-statistical. Auditors may use a combination of the Statistical and Non-statistical approaches as well as other approaches to sampling.

Regardless of the sampling approach, the CEA should determine the approach based on testing objectives. In a clear, readable style, this timely volume provides the information needed to design and execute audit samples for the appraisal, evaluation, and validation of financial and accounting data.

With this material, auditors and analysts can accomplish such required functions as evaluating program performance and determining the reliability of financial records and statements more quickly and.

Audit Sampling (Supersedes Statement on Auditing Standards No. 1, sections A, “Relationship of Statistical Sampling to Generally Accepted Auditing Standards ” and B, “Precision and Reliability for Statistical Sampling in Auditing”) 1. A u d it sampling is the application of an audit.

Written from the standpoint of internal and external auditors, the material is easily understood by an entry-level auditing student and can be used as a supplement to a basic auditing text. It is also appropriate for an advanced or graduate level auditing course. It is designed to reduce the gap between textbooks that give only introductory coverage to audit sampling and the basic level of.

Audit sampling enables the auditor to obtain and evaluate audit evidence about some characteristic of the items selected in order to form or assist in forming a conclusion concerning the population from which the sample is drawn. Audit sampling can be applied using either non-statistical or statistical sampling approaches.

Diligently reviewing a guide to audit sampling, Smith is reminded of a statistical sampling method called probabilityproportional-to-size, a name she vaguely remembers from her college days. PPS sampling, states the guide, is generally easier to use than classical variables sampling, and may be especially useful for accounts receivable.

Different Ways to Set Sample Size In an Audit; Different Ways to Set Sample Size In an Audit. You can use many different methods to calculate sample size.

They are based on statistics and probability so you can measure results. The method you use will be a function of your firm’s policy. About the Book Author Maire Loughran is a self.Statistical vs. Non-Statistical Sampling Statistical Sampling _____ Applies the laws of probability theory to assist the auditor in designing a sampling plan and subsequently evaluating the results of the sample.

Non-Statistical Sampling _____ __ Is solely based on the auditor’s judgment. This chapter introduces the general concepts of audit sampling applicable to statistical and nonstatistical sampling for tests of controls.

It also discusses guidelines for determining the sample size and performing the sampling plan and evaluating the results of applying audit procedures.