Exam 8: Audit Sampling: An Overview and Application to Tests of Controls

Before performing sampling procedures in an audit of controls, Sue set the tolerable deviation rate at 4.0%. After the procedures, she computes a computed upper deviation rate of 5.4%. What can Sue conclude about the entity's controls?

If the size of the sample to be used in a particular test of controls has not been determined by utilizing statistical concepts, but the sample has been chosen in accordance with random selection procedures

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

Confidence level is the complement of sampling risk.

If the expected deviation rate exceeds the tolerable deviation rate, the auditor is most likely to

Statistical sampling provides a technique for

For an attributes sampling plan, the tolerable deviation rate is 4.5%, the computed upper deviation rate is 7%, the sample deviation rate is 3%, and the desired confidence level is 95%. What is the allowance for sampling risk included in the computed upper deviation rate?

The risk of incorrect acceptance relates to the

An auditor plans to examine a sample of 20 checks for countersignatures as prescribed by the entity's internal control procedures. One of the checks in the chosen sample of 20 cannot be found. The auditor should consider the reasons for this limitation and

An advantage of using statistical over nonstatistical sampling methods in tests of controls is that the statistical methods

In attributes sampling, population size has little or no effect on sample size once the population exceeds approximately

The likelihood of assessing control risk too high is the risk that the sample selected to test controls

With a nonstatistical sampling application, the auditor relies on professional judgment rather than the laws of probability to reach a conclusion about the audit test.

Which of the following best describes the distinguishing feature of statistical sampling?

The term precision relates to

Auditors who prefer statistical sampling to nonstatistical sampling may do so because statistical sampling helps the auditor

In nonstatistical sampling for tests of controls, increasing the desired confidence level results in a

Audit sampling is not used for which type of audit evidence?

Which of the following best illustrates the concept of sampling risk?

Which of the following risks is related to efficiency of testing?