1.Audit Sampling

2. Introduction Scope Effective Date Objective Definition 3. Definition of audit Independent analysis Systematic approach Aimed to provide the opinion Definition of sampling process Less than 100% from population 4. Before sampling After Sampling 5. Less than 100% of items within a population All sampling units have chance of selection Reasonable basis to draw conclusion Good Audit Sampling 6. Application At that time when auditor has decided audit sampling while performing audit Use of various statistical and non- statistical sampling when designing and selecting the audit samples, performing test of controls and test of details and evaluating result from the sample. 7. To get reasonable basis for conclusion about the population from which sample is collected. 8. April 1, 2009 9. Population Sampling risk Non-Sampling risk Anomaly Sampling unit Stratification Tolerable misstatement Tolerable rate of deviation 10. Definitions Population : Entire set of data from which sample is selected and about which auditor wishes to draw conclusions. Sampling Risks: Auditors conclusion may have been different if entire population was taken into consideration Non-sampling Risk: The risk that auditor reaches erroneous conclusion for any reason not related to sampling risk Sampling Unit: The individual item constituting a population. 11. Statistical Sampling These type of sampling have following characteristics Random selection of sample units The use of probability theory to evaluate sample results including measurement of sampling risks. If sample lacks above characters then it is called as Non-Statistical Sampling. 12. Stratification The process of dividing populations into sub-Population each of which is a group have sampling units of similar characters. Tolerable Mistake A monetary amount set by the auditor in respect of which the auditor seeks to obtain an appropriate level of assurance that the monetary amount set by the auditor is not exceeded by the actual misstatement in the population. Tolerable rate of Deviation A rate of deviation from prescribed internal control procedures set by the auditor in respect of which the auditor seeks to obtain an appropriate level of assurance that the rate of deviation set by the auditor is not exceeded by the actual rate of deviation in the population. 13. Characteristics of the population Ask question to ourselves, Is sampling size sufficient to reduce sampling risk to acceptably low level? Next important questions for ourselves, Does every item in the population have equal chances of selection? 14. Nature and Cause of Deviations and Misstatement -Auditor shall investigate the nature and cause of any deviations or misstatement identified - Evaluate their possible effects Extreme rare situation consider misstatement as Anomaly, but before it auditor has to obtain high degree of certainty. 15. Presented By : Dipendra Prasad Poudel Date : 26/03/2014 Contact information mailfordipendra@gmail.com infodipendra.blogspot.in