Principles Of Auditing & Other Assurance Services
21st Edition
ISBN: 9781259916984
Author: WHITTINGTON, Ray, Pany, Kurt
Publisher: Mcgraw-hill Education,
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Chapter 5, Problem 12RQ
To determine
Comment on the statement related to data analytics.
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Sampling, rather than surveying an entire population, can offer some substantial benefits. Some of those benefits include
O eliminating the risk of error.
O saving money and time.
O obtaining less variability in the data set.
For both tests of controls and substantive tests of details, non-sampling risk can be reduced by increasing sample size, while sampling risk can be reduced by proper engagement planning supervision and review.
TRUE OR FALSE? WHY?
An advantage of statistical sampling over nonstatistical sampling methods is that statistical methodsa. Afford more assurance than a nonstatistical sample of equal size.b. Provide an objective basis for quantitatively evaluating sampling risk.c. Can more easily convert the sample into a dual-purpose test useful for substantive procedures.d. Eliminate the need to use judgment in determining appropriate sample sizes
Chapter 5 Solutions
Principles Of Auditing & Other Assurance Services
Ch. 5 - Prob. 1RQCh. 5 - Prob. 2RQCh. 5 - Prob. 3RQCh. 5 - Distinguish among routine, nonroutine, and...Ch. 5 - Prob. 5RQCh. 5 - Prob. 6RQCh. 5 - Prob. 7RQCh. 5 - As part of the verification of accounts receivable...Ch. 5 - Prob. 9RQCh. 5 - When in the course of an audit might the auditors...
Ch. 5 - Prob. 11RQCh. 5 - Prob. 12RQCh. 5 - Prob. 13RQCh. 5 - Prob. 14RQCh. 5 - Prob. 15RQCh. 5 - Prob. 16RQCh. 5 - Prob. 17RQCh. 5 - Prob. 18RQCh. 5 - Prob. 19RQCh. 5 - What disclosures should be made in the financial...Ch. 5 - Prob. 21RQCh. 5 - Prob. 22RQCh. 5 - Prob. 23RQCh. 5 - Prob. 24RQCh. 5 - Prob. 25RQCh. 5 - Prob. 26RQCh. 5 - Prob. 27RQCh. 5 - Prob. 28RQCh. 5 - Prob. 29RQCh. 5 - Prob. 30RQCh. 5 - Prob. 31RQCh. 5 - I have finished my testing of footings of the cash...Ch. 5 - Prob. 33RQCh. 5 - Prob. 34RQCh. 5 - Financial statements contain a number of...Ch. 5 - Prob. 36QRACh. 5 - In an audit of financial statements, the auditors...Ch. 5 - Prob. 38QRACh. 5 - Prob. 39QRACh. 5 - Prob. 40QRACh. 5 - Prob. 41QRACh. 5 - Prob. 42QRACh. 5 - Prob. 43QRACh. 5 - Prob. 44QRACh. 5 - Prob. 45AOQCh. 5 - Prob. 45BOQCh. 5 - Prob. 45COQCh. 5 - Prob. 45DOQCh. 5 - Prob. 45EOQCh. 5 - Prob. 45FOQCh. 5 - Prob. 45GOQCh. 5 - Prob. 45HOQCh. 5 - Prob. 45IOQCh. 5 - Prob. 45JOQCh. 5 - Prob. 45KOQCh. 5 - A difference of opinion concerning accounting and...Ch. 5 - Prob. 46OQCh. 5 - Prob. 47OQCh. 5 - Prob. 48AOQCh. 5 - Prob. 48BOQCh. 5 - Prob. 48COQCh. 5 - The cost of analytical procedures in terms of time...Ch. 5 - Prob. 48EOQCh. 5 - Prob. 49OQCh. 5 - Prob. 50PCh. 5 - Prob. 51PCh. 5 - Prob. 52PCh. 5 - Prob. 53PCh. 5 - Prob. 54PCh. 5 - Prob. 55PCh. 5 - Prob. 56P
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Similar questions
- Which of the following is not an advantage of non-statistical sampling? a) It allows an auditor to select a sample that they believe is appropriate. b) It allows an auditor to measure sampling risk. c) It is lower cost than statistical sampling. d) It requires less staff training.arrow_forwardThe primary benefit of using nonstatistical sampling is thata. It generally results in a smaller sample size.b. It removes the need to consider allowance for sampling risk.c. It is simpler to use.d. All of the above are true.arrow_forwardWhat are the advantages of sampling items in a population instead of testing every item? (Several choices may be correct.) It is impossible to arrive at the wrong conclusion Increases the cost of the audit Allows auditor to project results to the whole population Reduces the time required for testingarrow_forward
- Which one of the following is the main problem with using non-probability sampling technique? a. The expense b. The results are never representative c. Human judgement error d. Non co-operation of informantsarrow_forward2. Which of the following is not true about the advantages of statistical sampling approach? * A. The auditor is in a better position to calculate sampling risks. B. Sample findings are evaluated in a more "scientific" way. C. The sample is more efficiently designed. D. The auditor is in a better position to control sampling risks. E. None of themarrow_forward1.1.Sampling is important in an audit process. Briefly explain the value of sampling in the audit process. 1.2. Identify and explain the two types of sampling risks?arrow_forward
- Stratification of the population generally results in a moreefficient sampling plan. TRUE OR FALSE? WHY?arrow_forwardStatistical sampling and use of computer-assisted audit techniques (CAATs) are important to the IS audit for evidence gathering. Answer one of the following questions: Explain the difference between statistical and non-statistical approaches to sampling. What do you think is most commonly used by auditors? Do you think the selection is situational-dependent?arrow_forwardWhen the auditor goes through a population and selects items for the sample without regard to their size, source, or other distinguishing characteristics, it is called Block selection\ Haphazard selection Random selection Systematic selectionarrow_forward
- The two types of sampling risks that auditors face include the risk of incorrect acceptance and the risk of incorrect rejection. What do each of these mean and how will each impact the audit process and the audit results? Which is considered the more important risk?arrow_forwardWhich one of the following is the main problem with using non-probability sampling technique? a. The expense b. The results are never representative c. Human judgement error d. Non co-operation of informants FAST PLIZarrow_forwardA principal advantage of statistical methods of attribute sampling over nonstatistical methods is that they provide a scientific basis for planning the A. risk of overreliance B. tolerable rate C. expected population deviation rate D. Sample sizearrow_forward
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