What type of sampling plan should the auditors use for test?, Auditing

Assignment Help:

In performing a test of controls for sales order approvals, the CPAs stipulate a tolerable deviation rate of 8 percent with a risk of assessing control risk too low of 5 percent. They anticipate a deviation rate of 2 percent.
a. What type of sampling plan should the auditors use for this test?

b. Using the appropriate table or formula from this chapter, compute the required sample size for the test.

c. Assume that the sample indicates four deviations. May the CPAs conclude with a 5 percent risk of assessing control risk too low that the population deviation rate does not exceed the tolerable rate of 8 percent?

d. Use ACL to compute the required sample size for the test. Assume that the population size is composed of 100,000 items.

e. Assume that the sample indicates four deviations using the sample size determined in d.
Use ACL to calculate the results. May the CPAs conclude with a 5 percent risk of assessing control risk too low that the population deviation rate does not exceed the tolerable rate of 8 percent?


Related Discussions:- What type of sampling plan should the auditors use for test?

Audit evidence, State four factors considered determining sufficiency of a...

State four factors considered determining sufficiency of audit evidence

The internal audit differ from an external audit, Describe How does the int...

Describe How does the internal audit differ from an external audit? Ans) Internal audit nothing but the checking the product that you formed. External audit is checking you

Action if management refuses to provide representations, Action if Manageme...

Action if Management Refuses to Provide Representations If management refuses to provide a representation that the auditor considers essential, this constitutes a scope restric

#TITLE, WHAT OF COST OF JOURNAL ENTRY?

WHAT OF COST OF JOURNAL ENTRY?

Valuation - detailed audit of stock, Valuation - Detailed Audit of Stock ...

Valuation - Detailed Audit of Stock IAS 2 prescribes such stock be priced at the lower of price and net realizable price, It is up to the auditor to ensure that net realizable

Records kept by auditor, Records kept by AUDITOR of procedures applied, tes...

Records kept by AUDITOR of procedures applied, tests performed, the information obtained and pertinent conclusions reached in the course of the AUDIT. (2) Any records developed by

Providers of funds, Providers of Funds A further point to note is that ...

Providers of Funds A further point to note is that modern companies can be very large with multinational activities. Preparing accounts for such a group becomes a very complex

Limitation of audit evidence, Limitation of Audit Evidence The quantit...

Limitation of Audit Evidence The quantity and quality of evidence is constrained through the following factors as: Absolute proof is not possible; Some assert

Assignments, Describe the factors which decide the broad area of Scientific...

Describe the factors which decide the broad area of Scientific activity?

Buyers - disclosure and presentation, Buyers - Disclosure and Presentation ...

Buyers - Disclosure and Presentation This case (case of Aluminium Industries vaassen B V v. Romalpa Aluminium Ltd) are simply relevant whether creditors involve a material amo

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd