Reference no: EM132604542

There is work on the accounts receivable section of the audit of XYZ company. you have completed your study of the internal controls( attribute sampling) over sales and receivables and have decided that the key control over the completeness of sales is that shipping orders must be matched to sales invoices.

GIVEN

Acceptable risk of incorrect acceptance(beta risk) = 10%

Expected population deviation rate =1%

Tolerable deviation rate= 2%

Based on the work completed, you discovered, that three shipping orders were not attached to sales invoices.

REQUIRED

Question 1: How to determine the correct sample size.

Question 2: Test to see if the control is operating as described.

Question 3: How to Prepare in good form of working paper to determine the upper error and lower error bounds and conclude whether the population is correct or not. Each step should you clearly specify how it relates to the facts in the question ( with calculations)