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  • Audit Sampling: Sampling and Non-Sampling Risk CPA Exam: Johnson Plum

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    For large populations, the sample size formula uses the standard normal distribution value (Z), standard deviation (σ), and desired margin of error (E). Acceptable evidence levels are roughly 68% (1 sigma), 80%, and 90-95% (2 sigma). For small populations, a good maximum sample size is usually 10% but should not exceed 1000. Factors like confidence level, expected variance, desired precision determine sample size. Audit sampling involves both statistical and non-statistical methods. Resources on audit sampling provide guidance on techniques, tables, and applying sampling in audits.

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    For large populations, the sample size formula uses the standard normal distribution value (Z), standard deviation (σ), and desired margin of error (E). Acceptable evidence levels are roughly 68% (1 sigma), 80%, and 90-95% (2 sigma). For small populations, a good maximum sample size is usually 10% but should not exceed 1000. Factors like confidence level, expected variance, desired precision determine sample size. Audit sampling involves both statistical and non-statistical methods. Resources on audit sampling provide guidance on techniques, tables, and applying sampling in audits.

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    10 views2 pages

    Audit Sampling: Sampling and Non-Sampling Risk CPA Exam: Johnson Plum

    Uploaded by

    johnson lee
    For large populations, the sample size formula uses the standard normal distribution value (Z), standard deviation (σ), and desired margin of error (E). Acceptable evidence levels are roughly 68% (1 sigma), 80%, and 90-95% (2 sigma). For small populations, a good maximum sample size is usually 10% but should not exceed 1000. Factors like confidence level, expected variance, desired precision determine sample size. Audit sampling involves both statistical and non-statistical methods. Resources on audit sampling provide guidance on techniques, tables, and applying sampling in audits.

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    of 2

    AB test basis:

    https://saylordotorg.github.io/text_introductory-statistics/s12-04-small-sample-tests-for-
    a-popul.html

    For a large population, calculate using the formula


    where Z is the value from the standard normal distribution reflecting the confidence level
    that will be used (e.g., Z = 1.96 for 95%), 
    σ is the standard deviation of the outcome variable and 
    E is the desired margin of error.  

    The levels of evidence low, moderate, and high translate to roughly 68%(1sigma),
    around 80%, and 90-95%(2 sigma)  
    eg. 2 sigma 95% evidence, acceptable error rate: 2/115=0.017 = 1.7%, sample size =
    115, more than 2 error then reject.
    1 sigma, accepte error 3%, sample size =65

    For small population, 


    A good maximum sample size is usually 10% as long as it does not exceed 1000  

    http://www.tools4dev.org/resources/how-to-choose-a-sample-size/

    more to check:
    https://pcaobus.org/oversight/standards/archived-standards/details/AU350

    johnson plum <johnson.plums@gmail.com> Tue, Jan


    12, 2021,
    10:32 AM
    to Joanna

    Audit Sampling: Sampling and Non-


    Sampling Risk CPA Exam
    https://www.youtube.com/watch?
    v=KMXZvdO_AWU&list=PLxP0KZzCGFYO2TXSQO7GuEvEJEV3G7b-3&index=1

    Attachments area
    Preview YouTube video Audit Sampling: Sampling and Non-Sampling Risk
    CPA Exam
    Audit Sampling: Sampling and Non-Sampling Risk CPA Exam

    audit book and charts, tables to download  :


    https://books.google.ca/books?
    id=5vxNDQAAQBAJ&printsec=frontcover#v=onepage&q&f=false
    https://future.aicpa.org/cpe-learning/publication/audit-sampling-audit-guide-
    OPL#:~:text=Introduces%20statistical%20and%20nonstatistical%20sampling,%2C
    %20in%20real%2Dworld%20situations.&text=Do%20you%20have%20an%20AICPA
    %20membership%3F
    https://www.amazon.ca/Audit-Guide-Sampling-2019-AICPA/dp/195068833X
    https://www.aicpastore.com/Content/media/PRODUCER_CONTENT/Newsletters/
    Articles_2008/CPA/Sept/Auditwatch.jsp
    https://linfordco.com/blog/audit-sampling/
    http://safety.carrefour.fr/cgi/viewcontent.php?
    article=aicpa.audit.sampling.guide.table&context=libpubs
    https://www.goodreads.com/book/show/36821298-audit-guide
    https://wenku.baidu.com/view/53e2b806864769eae009581b6bd97f192279bf6d.html?
    fr=search-4&fixfr=%2BESc%2Ba8HsX4r2JhwmS1DNg%3D%3D
    https://wenku.baidu.com/view/7293ba8bcc22bcd126ff0c78

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