Auditors Who Prefer Statistical to Nonstatistical Sampling Believe That the Principal

question 47

Multiple Choice

Auditors who prefer statistical to nonstatistical sampling believe that the principal advantage of statistical sampling flows from its unique ability to

• A) Define the precision required to provide audit satisfaction.
• B) Mathematically measure uncertainty.
• C) Establish conclusive audit evidence with decreased audit effort.
• D) Promote a more legally defensible procedural approach.

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Definitions:

Margin of Error

An expression of the amount of random sampling error in a survey's results, indicating the range within which the true population parameter is likely to lie with a certain level of confidence.

Confidence

The degree of certainty or belief in a certain outcome, often used in the context of statistical confidence levels.

Standard Deviation

A statistic that quantifies the dispersion or variability of a set of data points around the mean.

Confidence Interval

An estimate expressed as an interval of values used to estimate a population parameter, indicating the reliability of the estimate.