Sample Size Determination. For each of the following independent cases, use AICPA sample size tables to identify the missing value(s). Control 1 2 3 4 Risk of overreliance 5.0% 5.0% 10.0% (d) Expected population deviation rate 1.25% 2.5% (c) 1.25% Tolerable rate of deviation 7.0% (b) 6.0% 6.0% Sample size (a) 68 153 78

Sample Size Determination. For each of the following independent cases, use AICPA sample size tables to identify the missing value(s). Control 1 2 3 4 Risk of overreliance 5.0% 5.0% 10.0% (d) Expected population deviation rate 1.25% 2.5% (c) 1.25% Tolerable rate of deviation 7.0% (b) 6.0% 6.0% Sample size (a) 68 153 78

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter8: Specialized Audit Tools: Attributes Sampling, Monetary Unit Sampling, And Data Analytics Tools

Section: Chapter Questions

Problem 32CYBK

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Consider a sample with data values of 10, 20, 12, 17, and 16. a. Compute the mean and median. b. Consider a sample with data values 10, 20, 12, 17, 16, and 12. How would you expect the mean and median for these sample data to compare to the mean and median for part a (higher, lower, or the same)? Compute the mean and median for the sample data 10, 20, 12, 17, 16, and 12.
Sample Results Evaluation.Required:Review each of the following independent sets of conditions. For each condition, calculatethe (1) sample rate of deviation, (2) ULRD, and (3) allowance for sampling risk (n = samplesize, d = deviations, ROO = risk of overreliance). What is your conclusion regarding therelationship of each of these factors to the ULRD based on comparing the ULRD across different combinations of these factors?a. n = 100, d = 8, ROO = 5%.b. n = 100, d = 4, ROO = 5%.c. n = 100, d = 8, ROO = 10%
ample Size Determination. Review each of the following independent sets of conditions.Required:Use AICPA sample size tables to identify the appropriate sample size for use in a statisticalsampling application (ROO = risk of overreliance, EPDR = expected population deviationrate, TRD = tolerable rate of deviation). What is your conclusion regarding the relationshipof each of these factors to sample size based on comparing the sample sizes across differentcombinations of these factors?a. ROO = 5%, EPDR = 0%, TRD = 7%.b. ROO = 5%, EPDR = 3%, TRD = 7%.c. ROO = 5%, EPDR = 3%, TRD = 6%.d. ROO = 10%, EPDR = 0%, TRD = 7%.
Review each of the following independent sets of conditions. For each condition, calculatethe (1) sample rate of deviation, (2) ULRD, and (3) allowance for sampling risk (n = samplesize, d = deviations, ROO = risk of overreliance). What is your conclusion regarding therelationship of each of these factors to the ULRD based on comparing the ULRD across different combinations of these factors?a. n = 100, d = 8, ROO = 5%.b. n = 100, d = 4, ROO = 5%.c. n = 100, d = 8, ROO = 10%
The following are auditor judgments and attributes sampling results for six populations. Assume large population sizes. 1 2 3 4 5 6 EPER (in percent) 2 0.5 1 0 2 5 TER (in percent) 6 4 20 3 8 10 ARO (in percent) 10 5 10 5 5 10 Actual sample size 100 100 20 100 60 60 Actual number of exceptions in the sample 2 3 1 1 1 5 For each population, did the auditor select a smaller sample size than is indicated by using the attributes sampling tables in Table 15-8(p. 519) for determining sample size? What are the implications of selecting either a larger or smaller sample size than those determined using the tables? Calculate the SER and CUER for each population. For which of the six populations should the sample results be considered unacceptable? What options are available to the auditor? Why is analysis of the exceptions necessary even when the populations are considered acceptable? For…
Determine the Sample size in the AHMED Company according to the following data: Book value of population tested = 500000 $ The Reliability factor for the specified risk of incorrect acceptance= 3 Tolerable misstatement = 40000 $ Anticipated misstatement= 4000 $ Expansion factor for anticipated misstatement = 1.5
Calculate total projected mistreatment if the following three mistreatments were discovered in a PPS sample when the sampling interval is $1,000. Recorded Amount Audit Amount Sampling interval Total Projected Mistreatment 1st mistreatment $400 $320 $1,000 _________________ 2nd mistreatment 500 0 $1,000 _________________ 3rd mistreatment 3,000 2,500 $1,000 _________________
Which of the following combinations results in an increase in sample size in an attribute sample? a. Allowable Risk of Overreliance Tolerable Rate Expected Population Deviation Rate Decrease Decrease Increase b. Allowable Risk of Overreliance Tolerable Rate Expected Population Deviation Rate Decrease Increase Decrease c. Allowable Risk of Overreliance Tolerable Rate Expected Population Deviation Rate Increase Increase Decrease d. Allowable Risk of Overreliance Tolerable Rate Expected Population Deviation Rate Increase Increase Increase e. Allowable Risk of Overreliance Tolerable Rate Expected Population Deviation Rate Increase Decrease Increase
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Attributes Sampling with IDEA: Evaluating Sample Results. Based on a population sizeof 388 shipments, a 10 percent desired risk of overreliance, an expected population deviation rate of 1 percent, and a tolerable rate of deviation of 6 percent, the audit team selected asample of 58 items.In performing tests of controls, your audit team identified three shipments that were notsupported by an approved sales order and concluded that these represent deviations from thecontrol activity.Required:a. Use IDEA to determine the ULRD. What would the audit team’s conclusion be withrespect to the functioning of ELM’s control over the authorization of sales transactions?Part (b) is a set of independent scenarios that affect the evaluation of sample results.b. For each of the following numbers of deviations, use IDEA to determine the ULRD andprovide the audit team’s conclusion with respect to the functioning of ELM’s controlover the authorization of sales transactions.1. 0 deviations.2. 1…
The upper precision limit (CUER) in statistical sampling is(1) the percentage of items in a sample that possess a particular attribute.(2) the percentage of items in a population that possess a particular attribute.(3) a statistical measure, at a specified confidence level, of the maximum rate ofoccurrence of an attribute.(4) the maximum rate of exception that the auditor would be willing to accept inthe population without altering the planned reliance on the attribute.

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		Control
	1	2	3	4
Risk of overreliance	5.0%	5.0%	10.0%	(d)
Expected population deviation rate	1.25%	2.5%	(c)	1.25%
Tolerable rate of deviation	7.0%	(b)	6.0%	6.0%
Sample size	(a)	68	153	78