Exam 18: Attributes Sampling

The upper limit rate of deviation equals the _____________________________ plus the allowance for sampling risk.

The ultimate purpose of control risk assessment is to:

An auditor who uses statistical sampling for attributes in testing internal controls should reduce the planned reliance on a prescribed control when the

Which of the following would not result in the audit team's selecting a larger sample of controls for examination?

In performing attributes sampling,the auditor will conclude that the control is functioning as intended if the _____________ is less than or equal to ____________.

An auditor wants to perform a test of controls for a sensitive control.If she discovers even one deviation,she will reject the control as unacceptable.She is especially concerned about finding a deviation rate of more than 1 percent.Using discovery sampling and the sample evaluation table for 5 percent risk of overreliance,what sample size should she use?

The _______________________________ is the frame of reference used by the auditor to represent the population when selecting the sample.

The risk of _______________________ is the likelihood that the auditor's sample indicates that important controls are functioning effectively when,in fact,the true (but unknown)population deviation rate exceeds the tolerable rate of deviation.

If the sample evidence does not support the planned level of control risk,the audit team could

The auditor determines the tolerable rate of deviation based on the anticipated _____________________ on the client's internal control.

After examining sample items and classifying items as deviations,the auditor can divide the number of deviations by the sample size and calculate the

The auditor tested a sample of recorded sales invoices for evidence of credit approval.Based on the results of the sample,the auditor concluded that there was a satisfactory rate of approvals.Unknown to the auditor,credit approvals in the population were not satisfactory.This would be an example of the risk of

As a result of sampling procedures applied as tests of controls,an auditor incorrectly assesses control risk lower than appropriate.The most likely explanation for this situation is that

Sequential sampling is sometimes referred to as a(n)_________________________ sampling plan.

Of the two sampling risks associated with attributes sampling,auditors are more concerned with the risk of underreliance.

Rome,CPA,is examining the internal control of Smack,Inc.Rome has established a risk of overreliance of 10%,an expected population deviation rate of 1%,and a tolerable rate of deviation of 5%. Ignore your answer to question 85.Assume that a sample of 100 items was examined and 5 deviations were noted.What is the upper limit rate of deviation?

In addition to the quantitative measure of deviations,the auditor should also consider qualitative measures,such as the pervasiveness and source of the deviations.

The procedures for statistical evaluation of tests of controls with the AICPA evaluation tables would not include which of the following steps?

When verifying the completeness assertion for sales transactions,the auditor would define the population as a shipping document for purposes of performing tests of controls.

An auditor is testing control procedures that are evidenced on an entity's vouchers by matching random numbers with voucher numbers.If a random number matches the number of a voided voucher,that voucher ordinarily should be replaced by another voucher in the random sample if the voucher