Audit Sampling Prepared by Murodullo Turdiyev. Group Hba-81i Learning Objectives
Sample size estimation for attribute samplingAudit Sampling. Murodullo Turdiyev
Sample size estimation for attribute samples (alternative method)
- An alternative method is to determine sample size by reference to:
- Table 11.5 (p. 532), for where allowable risk of over-reliance (ARO) is 10% (90% confidence). This ARO is common in practice.
- Table 11.6 (p. 532), for where allowable risk of over-reliance is 5% (95% confidence).
- Approach in practice is to use sample deviation rate (SDR) as best estimate of population deviation rate.
- For example, auditor selects 25 items, finds one error => SDR rate is 4%.
- Auditor compares with tolerable deviation rate (TDR). If SDR <= TDR, sample results support auditor’s planned reliance on IC.
- If SDR > TDR, sample results do not support auditor’s planned reliance on IC, auditor will revisit audit plan and reduce reliance on IC and increase substantive testing.
- Arens, Elder, Beasley. Auditing and assurance services book.
- Gey, Semnati. Auditing and assurance services book
- accaglobal.com (website)
- Accountingtools.com (website
Thanks for your attention!
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