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Which of the following is not an advantage of probability proportional to size sampling? 1.It is effective for understatement errors 2.It will result in smaller sample sizes 3.It includes transactions or components reflecting larger peso amounts 4.It is generally simpler to use than classical variable sampling Which of the following best illustrates the concept of nonsampling risk? a)An auditor recognize errors in the documents examined for the chosen sample. b)An auditor may select audit procedures that are appropriate to achieve the specific objective. c)The documents related to the chosen sample may not be available for inspection. d)A randomly chosen sample may not be representative of the population as a whole on the characteristic of interest. Assuming the tolerable deviation rate is 5 percent, the expected population deviation rate is 3 percent, and the allowance for sampling risk is 2 percent, what should an auditor conclude if tests of 150 randomly selected documents reveals 4 deviations? a)Accept the sample results as support for assessing control risk below the maximum because the sample deviation rate plus the allowance for sampling risk exceeds the tolerable deviation rate. b)Assess control risk at the maximum because the sample deviation rate plus the allowance for sampling risk exceeds the tolerable deviation rate. c)Accept the sample results as support for assessing control risk below the maximum because the sample deviation rate plus the allowance for sampling risk is below the tolerable deviation rate. d)Assess control risk at the maximum because the tolerable deviation rate plus the allowance for sampling risk exceeds the expected population deviation rate. An advantage of nonstatistical sampling over statistical sampling is that nonstatistical sampling helps an auditor to a)Measure the sufficiency of the evidential matter obtained. b)Eliminate sampling risk. c)Reduce the level of audit risk and materiality to a relatively low amount. d)None of the choices. e)Minimize the failure to detect errors and frauds. Which if any of these components is completely a function of the sufficiency of the evidence gathered by the auditors procedures explain your answer?Explain your answer. Detection risk: risk that the auditors fail to detect a misstatement- is the only risk that is completely a function of the sufficiency of the evidence gathered by the auditor's procedures. It only exists when an audit (or other attest service) is being performed.
Which of the following generally provides the most reliable evidence?Objective evidence is more reliable, and hence more persuasive, than subjective evidence. The two most important factors when determining the appropriate sample size in an audit are the auditor's expectation of misstatements and the objectivity of the evidence.
Which of the following types of audit evidence generally is the most reliable?(1) Information obtained indirectly from outside sources is the most reliable audit evidence.
Which of the following is an accurate statement regarding audit evidence?Which of the following is a correct statement regarding audit evidence? The auditor must obtain a sufficient amount of relevant and reliable evidence to form an opinion on the fairness of the financial statements.
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Which of the following is generally true about the sufficiency of audit evidence quizlet?
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