If the Size of the Sample to Be Used in a Particular

question 7

Multiple Choice

If the size of the sample to be used in a particular test of controls has not been determined by utilising statistical concepts, but the sample has been chosen in accordance with random selection procedures:

• A) the auditor has committed a non-sampling error.
• B) no inferences can be drawn from the sample.
• C) the auditor will have to evaluate the results by reference to the principles of discovery sampling.
• D) the auditor may or may not achieve desired precision at the planned level of assessing control risk too low.

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Definitions:

Corporate Income Taxes

Taxes imposed on the income or profit earned by corporations and are calculated based on the tax laws of the country in which the corporation is located.

Canada Revenue Agency

The federal agency responsible for administering tax laws and various social and economic benefit and incentive programs delivered through the tax system in Canada.

Tax Exempt

Describes income, property, or transactions that are legally free from tax liability.

Common Equity

The amount of ownership in a corporation that is held by common shareholders, represented by the value of common stock plus retained earnings.