Statistical

Sampling
Selection Methods
 Random Sampling
• Selects the sample completely at random from the entire
population.
• Each item in the population has the same chance of being
selected.
 Systematic Sampling
• Other term : Interval Sampling
• Draws every nth item in the population for inclusion in the
sample with a random starting point.
• Si auditor subong may gina sunod na nga rule/pattern sa
pag pili niya sang iya sample sa population.
• See illustration sa book.
 Stratified Sampling
• The population is subdivided into groups for greater
homogeneity.
• The sample results of each groups are combined to obtain
the estimate of the total population value.
 Sample Size
• To determine the sample size the auditor should consider
whether sampling risk is reduced to an acceptably low
level.
• The lower the risk he is willing to accept, the greater the
sample size will be needed.
 Materiality
• Is a concept or convention within auditing and accounting
relating to the importance/significance of an amount.
 The Quality of Internal Control
• Affects the sample size and the extent of sampling
methods needed.
• If internal control is weak and the auditor needs more
assurance, he increases the size of the sample.
 Relative Risk
• Is the susceptibility of an account to error or
irregularities.
• Is often used when the study involves comparing the
likelihood, or chance, of an event occurring between two
groups.
 Evaluation of Sample Results
• To determine whether the preliminary assessment of the
relevant characteristics of the population is confirmed or
needs to be revised.
• The auditor must analyze any error detected in the
sample.
 Audit Sampling for Tests of
Controls/Attribute Sampling
• Attribute Sampling may be statistical or non-statistical
sampling.
• Statistical Sampling has 3 types of sampling procedures.
 Estimation Sampling
A statistical method used by auditors to determine the
proper sampling size for determining whether accounting
controls are being followed or not, as part of an audit.
Estimation sampling is used to calculate what the minimum
sample size should be.
 Discovery Sampling
• Is adapted when intentional or unintentional errors are
believed to be possible.
• Population would be accepted if zero errors were
discovered but will be rejected if an error was discovered.
 Acceptance Sampling
• The auditor uses Acceptance Sampling to determine
acceptability of the population and will require a “yes” or
“no” decision.
• The auditor may accept or reject a group of items whose
sample results differ from expected.
 Steps in the Application of Audit
Sampling in Tests of Controls
• Step 1 : Identify audit objective and control to be tested.
• Step 2 : Define the attribute and deviation condition/error.
• Step 3 : Define the population and the sampling risk.
• Step 4 : Determine the tolerable deviation rate and the risk
of assessing control risk too low.
• Step 5 : Specify the expected population deviation rate.
• Step 6 : Determine the sample size.
• Step 7 : Select the sample.
• Step 8 : Perform the compliance test on the sample items.
• Step 9 : Evaluate the sample results
• Step 10 : Documentation of the results of attribute
sampling tests of control.
 Non-Statistical Attributes
Sampling
• Non-statistical sampling is the selection of a test group
that is based on the examiner's judgement, rather than
a formal statistical method. For example, an examiner
could use his own judgment to determine one or more of
the following:
- The sample size
- The items selected for the test group
- How the results are evaluated