Audit Sampling Techniques in Malaysia

What is the primary purpose of sampling in auditing?

• To ensure that all auditors have the same opinion on the findings.

• The primary purpose of sampling in auditing is to draw conclusions about a population based on a subset.

• To verify the accuracy of every transaction in the population.

• To eliminate the need for any documentation during the audit process.

Name one common sampling method used in auditing.

• Systematic sampling

• Random sampling

• Cluster sampling

• Judgmental sampling

What is the difference between statistical and non-statistical sampling?

• Non-statistical sampling allows for statistical inference while statistical does not.

• Statistical sampling is random and allows for statistical inference, while non-statistical sampling is non-random and may introduce bias.

• Statistical sampling is used only for large populations, while non-statistical is for small ones.

• Statistical sampling is always biased and non-statistical is always random.

Define attribute sampling in the context of auditing.

• Attribute sampling is a method used in auditing to assess the presence or absence of specific attributes in a population.

• Attribute sampling focuses on the quantitative analysis of financial data.

• Attribute sampling is a technique to evaluate financial statements in detail.

• Attribute sampling is used to determine the overall value of an asset.

What is the role of risk assessment in audit sampling?

• Risk assessment is only necessary for financial audits.

• Risk assessment eliminates the need for sampling altogether.

• Risk assessment focuses solely on compliance issues.

• Risk assessment guides the selection of audit samples to focus on higher-risk areas.

Explain the concept of sampling risk.

• Sampling risk is the risk of making incorrect inferences about a population based on a sample that may not accurately represent it.

• Sampling risk is the likelihood of a sample being perfectly representative of the population.

• Sampling risk refers to the risk of collecting data from the entire population.

• Sampling risk is the chance of selecting a sample that is too large.

What is the significance of the sample size in statistical sampling?

• The sample size impacts the accuracy, reliability, and validity of statistical results.

• Sample size is only important for qualitative research.

• Sample size has no effect on statistical results.

• Larger sample sizes always lead to biased outcomes.

Describe the concept of monetary unit sampling.

• Monetary unit sampling is a technique used to analyze non-financial data in audits.

• Monetary unit sampling focuses solely on the quantity of transactions rather than their monetary value.

• Monetary unit sampling is a method that randomly selects transactions regardless of their value.

• Monetary unit sampling is a statistical sampling method that selects items based on their monetary value, focusing on higher-value transactions to identify errors in financial statements.

How does the auditor determine the appropriate sampling method?

• The auditor chooses the method based on personal experience only.

• The auditor assesses audit objectives, population characteristics, risk of material misstatement, and cost-efficiency.

• The auditor uses random selection without any criteria.

• The auditor relies solely on client preferences.

What factors should be considered when assessing risk in sampling?

• Sample color, texture, and shape

• Time of day and weather conditions

• Personal opinions and preferences

• Sample size, sampling method, population variability, potential biases, confidence level, margin of error.