18 Questions
What type of selection is best for prenumbered items?
Random Selection
Which of the following is true about managing non-sampling risks?
Cannot be eliminated
In attribute sampling, which relationship is correct regarding sample size and assessed RoMM (specifically CR)?
Inverse
What does variable sampling involve?
Accept/Reject approach with one deviation
Which of the following is a characteristic of attribute sampling?
Population size has significant impact
What type of selection involves a higher probability for items with higher amounts?
Value-weighted selection
What is the main advantage of using value-weighted selection for sampling?
It increases the chances of selecting items of higher value
Which attribute testing method is least desirable due to a possible concentration of samples?
Block selection
What does 'tolerable deviation rate' refer to in the context of internal control procedures?
Rate set by the auditor seeking assurance it won't be exceeded
In attributes sampling, what is the approach regarding samples containing anomalous errors?
They are replaced as they are isolated events
Which method uses each monetary unit as one sampling unit?
Value-weighted selection
Why is systematic selection less desirable compared to other sampling methods?
It doesn't provide a random sample
Which procedure is least likely reliable when used alone but enhances the reliability of other audit procedures?
Inspection
What is the main difference between vouching and tracing?
Selects an item of transaction and follows/verifies it into the accounting records
What is an example of a non-sampling risk associated with audit procedures?
Risk of under reliance (Type 1)
Which factor contributes to managing sampling risks in auditing?
Choosing an appropriate sample selection method
What is the purpose of using analytical procedures in auditing?
Comparing financial information with expectations
When is tracing typically used in auditing?
Following up on individual transactions
Test your knowledge on Random Number Generators (RNGs) and different sampling techniques like Systematic Selection, Haphazard Selection, Value-weighted selection, and Block Selection. Learn about managing non-sampling risks and the strategies involved.
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