CPA Auditing and Attestation (AUD) : Sampling
Study concepts, example questions & explanations for CPA Auditing and Attestation (AUD)
All CPA Auditing and Attestation (AUD) Resources
Example Questions
Example Question #11 : Audit Sampling
“Non-sampling risk” is:
Errors caused that are unrelated to the sample
The sample size is too small
The sample size is too large
The auditor will choose an incorrect sample
Errors caused that are unrelated to the sample
Non-sampling risk is unrelated to the sample itself. Typically, a non-sampling risk would involve the misapplication of audit procedures. This would be unrelated to the sample
Example Question #12 : Audit Sampling
In the case of sampling risk:
Both a and b
controls are less effective than they actually are
Neither a or b
controls are more effective than they actually are
Both a and b
Both a and b are correct. This risk could be that controls are more effective than they actually are causing oversampling or less than they actually are causing under-sampling.
Example Question #13 : Audit Sampling
Stratification is defined as:
Reducing the amount of the sample size
Dividing a population into sub populations
Multiplying a population into alternate populations
Increasing the amount of the sample size
Dividing a population into sub populations
In the concept of stratification, populations are divided into subsets. A probability sample is drawn from each group.
Example Question #1 : Sampling
For which of the following audit tests would an auditor most likely use attribute sampling?
Selecting accounts receivable for confirmation of account balances
Examining invoices in support of the valuation of fixed asset additions
Inspecting employee time cards for proper approval by supervisors
Making an independent estimate of the amount of a LIFO inventory
Inspecting employee time cards for proper approval by supervisors
Attribute sampling is used to test controls. Inspecting employee time cards for proper approval by supervisors is a test of controls. Controls often relate to authorization, validity, completeness, accuracy, classification, and proper period.
Example Question #2 : Sampling
While performing a test of details during an audit, an auditor determined that the sample results supported the conclusion that the recorded account balance was materially misstated. It was in fact not materially misstated. This situation illustrates the risk of:
Assessing control risk too low
Assessing control risk too high
Incorrect acceptance
Incorrect rejection
Incorrect rejection
Erroneously concluding that an account balance is materially misstated is an example of incorrect rejection.
Example Question #3 : Sampling
When conducting testing of various data areas during an audit, the auditor should uniformly use the same sample selection procedures for each testing unit.
False, the auditor should assess the best way of sampling each data set
True, when it facilitates the audit
True, only when the client advises this
False, there is a set procedure for how to proceed by the AICPA
False, the auditor should assess the best way of sampling each data set
Each data set to be tested requires a customized well thought out sampling and testing approach that allows the auditor to examine testing areas properly.
All CPA Auditing and Attestation (AUD) Resources
