Overveiw of Attribute sampling? 🫠

Audit sampling

testing less than 100% of the items within an acct bal

objective when test acct balances

Assertion/Acct present fairly with GAP

Existence or Occurence

taking a sample of recorded transactions, send out confermations that then happended

Completness

take a sample of subsequent cash dispursemtns to search for unrecorded liabilities

rights or obligations 

perform in conjuction with existance testing, including examining source the documents

valuation of allocation

select items and trace back source documents like invoices

presentaiton and valuation

selection items and verify estimates or other items for proper disscussion

sample needs to be _____ of the population

representative

population

sample is not represetive of the actual population → making a wrong conclusion

nonsampling risk

Auditor selects inapporpiate audit procedure and incorrectly evaluaties the test results ( reduces by reveiw and training)

Sampling risk on test of controls → Low effective

correct conclusion ( nothing to write home about)

Sampling risk on test of controls → Low Not effective

ineffective audit risk, risk of incorrect acceptance (scary)

Sampling risk on test of controls → High Effective

Ineffeciant Audit, risk or incorrect reject (unproductive)

Sampling risk on test of controls → High Effective

Correct conclustion, (We knew it was bad, and it was bad)

Attribute sampling is uesed in test of

controls

what is an attribute

charistic of a control

Attributes need to be anwered as a

Yes or No

what is the period covered by the population 

year

Sampling risk

risk of assessing control risk too low

tolerable rate of deviation

failure rate at which the auditor will determine the control is not operating effectively

expected population deveation rate

based on auditors experince with the client. Rate the auditor predicts the control will fail

sampling risk → increase

accept → Sample size decrease

tolerable deviation rate → increases

Accept → sample size decrease

Expected deviation rate → increase

Assess → sample size increase

If UDR ← TDR

Accept CR as origonally assed

UDR > TDR

Controls not working as accepted

Asses CR ___ than origonally planned and update the nature, timing, and extent of testing

Higher