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Question - Jill works for an auditing firm that is auditing AHD Ltd. Jill selected a random sample of payroll transactions for December 2013 and January 2014 and traced each sample item back to the personnel records to verify that the employee being paid was a legitimate employee of the client. Based on his review of the sample items, Jill concluded that the controls for that assertion could be relied on in the audit.
Required -
a. Identify the population in this case.
b. Briefly explain sampling error and give an example of how Jill's conclusion could be incorrect due to sampling error.
c. Briefly explain non-sampling error and give an example of how Jill's conclusion could be incorrect due to non-sampling error.
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