Question 1

Sound statistical theory consistently supports random number sampling with or without replacement.

Accepted Answer

A) True 
 B)False

Question 2

In selecting the sample, probabilistic methods must be used for both statistical and nonstatistical sampling.

Accepted Answer

A) True 
 B)False

Question 3

What types of exceptions are auditors most concerned with when evaluating populations of accounting data?

Accepted Answer

There are three types of exceptions that

Question 4

Sampling risk may be controlled by

Accepted Answer

A)    
B)    
C)    
D)    
A)    
B)    
C)    
D)

Question 5

Which of the following is an accurate statement regarding sampling distribution?

Accepted Answer

A)  A sampling distribution is a sample with characteristics the same as those of the population. 
B)  Sampling distributions allow the auditor to make probability statements about the likely representativeness of any sample that is in the distribution. 
C)  Each population exception rate and sample size has the same sampling distribution. 
D)  Auditors cannot use sampling distributions to draw statistical conclusions about the unknown population being sampled. 
A)  A sampling distribution is a sample with characteristics the same as those of the population. 
B)  Sampling distributions allow the auditor to make probability statements about the likely representativeness of any sample that is in the distribution. 
C)  Each population exception rate and sample size has the same sampling distribution. 
D)  Auditors cannot use sampling distributions to draw statistical conclusions about the unknown population being sampled.

Question 6

The exception rate that the auditor will permit in the population and still be willing to use the preliminary control risk assessment is called the

Accepted Answer

A)  acceptable exception rate. 
B)  estimated population exception rate. 
C)  sample exception rate. 
D)  tolerable exception rate. 
A)  acceptable exception rate. 
B)  estimated population exception rate. 
C)  sample exception rate. 
D)  tolerable exception rate.

Question 7

Using an appropriate sample selection method does not increase the likelihood of representativeness of the sample.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is the risk that an auditor will reach an incorrect conclusion because a sample is not representative of the population?

Accepted Answer

A)  sampling risk 
B)  nonsampling risk 
C)  audit risk 
D)  detection risk 
A)  sampling risk 
B)  nonsampling risk 
C)  audit risk 
D)  detection risk

Question 9

Because attributes sampling is a statistical sampling approach, it allows the auditor to quantify the allowance for sampling risk and the upper exception rate.

Accepted Answer

A) True 
 B)False

Question 10

Place the following steps in their proper order: 1. Analyze exceptions.
2) Select the sample.
3) Define attributes and exception conditions.
4) State the objectives of the audit test.
5) Specify the tolerable exception rate.

Accepted Answer

A)  1, 3, 2, 4, 5 
B)  4, 3, 1, 2, 5 
C)  4, 3, 5, 2, 1 
D)  1, 2, 3, 4, 5 
A)  1, 3, 2, 4, 5 
B)  4, 3, 1, 2, 5 
C)  4, 3, 5, 2, 1 
D)  1, 2, 3, 4, 5

Question 11

One of the causes of nonsampling risk is

Accepted Answer

A)  choosing the wrong sample size. 
B)  effective audit procedures. 
C)  inadequate sample size. 
D)  failure to recognize exceptions. 
A)  choosing the wrong sample size. 
B)  effective audit procedures. 
C)  inadequate sample size. 
D)  failure to recognize exceptions.

Sound statistical theory consistently supports random number sampling with or without replacement.

In selecting the sample, probabilistic methods must be used for both statistical and nonstatistical sampling.

What types of exceptions are auditors most concerned with when evaluating populations of accounting data?

Sampling risk may be controlled by

Which of the following is an accurate statement regarding sampling distribution?

The exception rate that the auditor will permit in the population and still be willing to use the preliminary control risk assessment is called the

Using an appropriate sample selection method does not increase the likelihood of representativeness of the sample.

Which of the following is the risk that an auditor will reach an incorrect conclusion because a sample is not representative of the population?

Because attributes sampling is a statistical sampling approach, it allows the auditor to quantify the allowance for sampling risk and the upper exception rate.

Place the following steps in their proper order: 1. Analyze exceptions. 2) Select the sample. 3) Define attributes and exception conditions. 4) State the objectives of the audit test. 5) Specify the tolerable exception rate.

One of the causes of nonsampling risk is

The Demand for Audit and Other Assurance Services

The CPA Profession

Audit Reports

Professional Ethics

Legal Liability

Audit Responsibilities and Objectives

Audit Evidence

Audit Planning and Materiality

Assessing the Risk of Material Misstatement

Fraud Auditing

Internal Control and Coso Framework

Assessing Control Risk and Reporting on Internal Controls

Overall Audit Strategy and Audit Program

Audit of the Sales and Collection Cycle: Tests of Controls

Completing the Tests in the Sales and Collection Cycle: Accounts Receivable

Audit Sampling for Tests of Details of Balances

Audit of the Acquisition and Payment Cycle: Tests of Controls, Substantive Tests of Transactions, and Accounts Payable

Completing the Tests in the Acquisition and Payment Cycle: Verification of Selected Accounts

Audit of the Payroll and Personnel Cycle

Audit of the Inventory and Warehousing Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash and Financial Instruments

Completing the Audit

Other Assurance Services

Internal and Governmental Financial Auditing and Operational Auditing

Filters

Exam 15: Audit Sampling for Tests of Controls and Substantive Tests of Transactions

Sound statistical theory consistently supports random number sampling with or without replacement.

In selecting the sample, probabilistic methods must be used for both statistical and nonstatistical sampling.

What types of exceptions are auditors most concerned with when evaluating populations of accounting data?

Sampling risk may be controlled by

Which of the following is an accurate statement regarding sampling distribution?

The exception rate that the auditor will permit in the population and still be willing to use the preliminary control risk assessment is called the

Using an appropriate sample selection method does not increase the likelihood of representativeness of the sample.

Which of the following is the risk that an auditor will reach an incorrect conclusion because a sample is not representative of the population?

Because attributes sampling is a statistical sampling approach, it allows the auditor to quantify the allowance for sampling risk and the upper exception rate.

Place the following steps in their proper order: 1. Analyze exceptions. 2) Select the sample. 3) Define attributes and exception conditions. 4) State the objectives of the audit test. 5) Specify the tolerable exception rate.

One of the causes of nonsampling risk is

The Demand for Audit and Other Assurance Services

The CPA Profession

Audit Reports

Professional Ethics

Legal Liability

Audit Responsibilities and Objectives

Audit Evidence

Audit Planning and Materiality

Assessing the Risk of Material Misstatement

Fraud Auditing

Internal Control and Coso Framework

Assessing Control Risk and Reporting on Internal Controls

Overall Audit Strategy and Audit Program

Audit of the Sales and Collection Cycle: Tests of Controls

Completing the Tests in the Sales and Collection Cycle: Accounts Receivable

Audit Sampling for Tests of Details of Balances

Audit of the Acquisition and Payment Cycle: Tests of Controls, Substantive Tests of Transactions, and Accounts Payable

Completing the Tests in the Acquisition and Payment Cycle: Verification of Selected Accounts

Audit of the Payroll and Personnel Cycle

Audit of the Inventory and Warehousing Cycle

Audit of the Capital Acquisition and Repayment Cycle

Audit of Cash and Financial Instruments

Completing the Audit

Other Assurance Services

Internal and Governmental Financial Auditing and Operational Auditing

Filters