Auditors Have a Variety of Sampling Approaches Available

question 24

Multiple Choice

Auditors have a variety of sampling approaches available.For each approach in the first column,identify the correct statement in the second column.Each statement may be used once,more than once,or not at all.
-Probability-proportional-to-size sampling.

• A)A method that is most effective in circumstances in which auditors expect a very low rate of occurrence of some critical deviation (e.g. ,a fraudulent cash disbursement).
• B)A classical method that uses both the audited and book values of items in the sample to obtain an estimated total audited value.
• C)The most frequently used general method that arrives at an estimated deviation rate.
• D)A method that defines the sampling unit as each individual dollar.
• E)A classical variables sampling plan enabling the auditors to estimate the average dollar value (or other variable)of items in a population by determining the average value of items in a sample.

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Definitions:

Ethical Imperatives

Moral obligations or commands that are viewed as universally true and guiding principles of behavior.

Comparative Reasoning

The process of using what is more familiar to make interpretations, explanations, or inferences about what is less familiar.

Ideological Reasoning

The process of thinking that begins with abstractions or generalizations that express one’s core beliefs, concepts, values, or principles and proceeds to reason top down to specific applications. Ideological reasoning is deductive and axiomatic. The argument maker takes the ideological premises on faith.