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    Focus Notes Psa 530

    Uploaded by

    Joyce Kay Azucena
    This document discusses audit sampling and other selective testing procedures. It defines key terms like audit sampling, anomalous error, population, sampling risk, non-sampling risk, sampling unit, statistical sampling, and stratification. It also discusses test of controls, substantive procedures, and appropriate procedures for obtaining evidence like inspection, observation, inquiry, confirmation, computation, and analytical procedures. The document provides guidance on selecting items for testing, including selecting all items, high value items, items over a certain amount, or using audit sampling. It also discusses selecting the sample, performing the audit procedure, and evaluating the nature and cause of any errors found.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Focus Notes Psa 530

    Uploaded by

    Joyce Kay Azucena
    829 views1 page
    This document discusses audit sampling and other selective testing procedures. It defines key terms like audit sampling, anomalous error, population, sampling risk, non-sampling risk, sampling unit, statistical sampling, and stratification. It also discusses test of controls, substantive procedures, and appropriate procedures for obtaining evidence like inspection, observation, inquiry, confirmation, computation, and analytical procedures. The document provides guidance on selecting items for testing, including selecting all items, high value items, items over a certain amount, or using audit sampling. It also discusses selecting the sample, performing the audit procedure, and evaluating the nature and cause of any errors found.

    Original Description:

    auditing theory

    Original Title

    FOCUS NOTES PSA 530

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    This document discusses audit sampling and other selective testing procedures. It defines key terms like audit sampling, anomalous error, population, sampling risk, non-sampling risk, sampling unit, statistical sampling, and stratification. It also discusses test of controls, substantive procedures, and appropriate procedures for obtaining evidence like inspection, observation, inquiry, confirmation, computation, and analytical procedures. The document provides guidance on selecting items for testing, including selecting all items, high value items, items over a certain amount, or using audit sampling. It also discusses selecting the sample, performing the audit procedure, and evaluating the nature and cause of any errors found.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    829 views1 page

    Focus Notes Psa 530

    Uploaded by

    Joyce Kay Azucena
    This document discusses audit sampling and other selective testing procedures. It defines key terms like audit sampling, anomalous error, population, sampling risk, non-sampling risk, sampling unit, statistical sampling, and stratification. It also discusses test of controls, substantive procedures, and appropriate procedures for obtaining evidence like inspection, observation, inquiry, confirmation, computation, and analytical procedures. The document provides guidance on selecting items for testing, including selecting all items, high value items, items over a certain amount, or using audit sampling. It also discusses selecting the sample, performing the audit procedure, and evaluating the nature and cause of any errors found.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    PSA 530 Audit Sampling and Other Selective

    Testing Procedures

    Audit Sampling involves the


    application of audit procedures to
    less than 100% of item which an
    account balance or class of
    transactions such that all sampling
    units have a chance of selection.
    Anomalous error error that
    arises from an isolated event that
    has not recurred other than on
    specifically identifiable occasions
    Population means that the entire
    set of data from which a sample is
    selected
    Appropriate to the
    objective of the sampling
    procedure
    Complete
    Sampling Risk arises from the
    possibility that the auditors
    conclusion based on a sample may
    be different from the conclusion
    reached if the entire population
    were subjected to the same audit
    procedure.
    Types:
    a. Control risk is lower than it
    actually is
    b. Control risk higher than it
    actually is
    Non-sampling risk arises from
    factors that cause the auditor to
    reach an erroneous conclusion for
    any reason not related to the size of
    the sample.
    Sampling unit individual items
    constituting a population
    Statistical Sampling random
    selection of a sample; use of
    probability theory to evaluate
    sample results.
    Stratification process of dividing
    a population into subpopulations.

    Test of Control performed if auditor


    plans to assess control risk less than
    high for a particular assertion
    Substantive Procedures analytical
    procedures and test of details of
    transactions and balances; obtain
    evidence to detect material
    misstatements in FS
    Procedures for Obtaining Evidence:
    inspection, observation, inquiry and
    confirmation, computation, and
    analytical procedures

    Appropriate means of selecting items


    for testing:
    a. Selecting all items (100%
    examination)
    b. Selecting specific items
    High value or key items
    All items over a certain
    amount
    Items to obtain information
    Items to test procedures
    c. Audit sampling using either
    non-statistical or statistical
    In
    determining
    sampling size,
    sampling
    methods
    the auditor should consider
    whether the sampling risk is
    reduced to an acceptably low
    level.
    Selecting the sample:
    The auditor should select items for the
    sample with the expectation that all
    sampling units in the population have
    a
    chance ofthe
    selection.
    Performing
    audit procedure:
    appropriate to the particular test
    objective on each item selected.
    Nature and Cause of Error
    a. Direct effect of identified errors
    on the FS
    b. Effectiveness of accounting and
    internal control systems and
    their effect on the audit
    procedure

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