Carlos Garcia, the senior-in-charge of the audit, asks you to determine the sample size for each of
Question:
- Carlos Garcia, the senior-in-charge of the audit, asks you to determine the sample size for each of the control procedures shown in the following table:
Control Procedure | |||||
Parameters | 1 | 2 | 3 | 4 | 5 |
Risk of assessing control risk too low | 5% | 5% | 10% | 10% | 5% |
Risk of assessing control risk too high | 10% | 10% | 5% | 5% | 10% |
Tolerable deviation rate | 2% | 3% | 3% | 2% | 4% |
Expected population deviation rate | 0% | 1% | 1% | .5% | 1.5% |
Sample size |
Using the sample sizes determined above and the number of deviations shown here, Carlos Garcia asks that you determine the sample deviation rate, and the computed upper deviation rate.
Control Procedure | |||||
Results | 1 | 2 | 3 | 4 | 5 |
Number of deviations | 2 | 2 | 2 | 3 | 1 |
Sample size used from table | |||||
Sample deviation rate | |||||
Tolerable deviation rate | 2% | 3% | 3% | 2% | 4% |
Computed upper deviation rate |
What decision would you make for each control procedure?
1. Decision:
2. Decision:
3. Decision:
4. Decision:
5. Decision:
Auditing and Assurance Services A Systematic Approach
ISBN: 978-1259162343
9th edition
Authors: William Messier, Steven Glover, Douglas Prawitt