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Dear Mike,
Q1. Can you tell me WHEN sampling risk arises ?
Q2. How we get know the sampling risk has aroused ?
AND
Q3. How auditors selects the sample ?
It will be kind of you, if you provide the answers of above questions in a simple, easy and with a practical example ?
Thanks
“Q1. Can you tell me WHEN sampling risk arises ?”
Whenever an auditor reaches an opinion about an item within the financial statements by testing only a sample of the population that makes up that item
“Q2. How we get know the sampling risk has aroused ?”
Sampling risk arises whenever we arrive at an opinion about an item in the financial statements by means only of testing a sample of the population
“Q3. How auditors selects the sample ?”
Establish materiality level and size of population
Select the sample either by:
arbitrary selection
cumulative monetary sampling
random number tables
systematic sampling
stratification first and then selectionIf you have time I suggest that you watch Ken’s video lecture on the F8 pages … that should clear up any doubts that you may still have
OK?
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