Case 6 Sampling (remote)

This case requires that your curate a sample of items to mimic a population of transactions. You will need to collect 100 small, identical items (think marbles, pebbles from the garden, dry beans from the pantry, or even small pieces of paper). You need to create your population with 100 items, 93 items will be good and 7 items should be identifiable as deviations. For the deviations, you can put a black dot on 7 pebbles, find 7 different colored marbles, or mark 7 pieces of paper with an x.

We must define our attribute being tested and any exceptions. Fill in your attributes.

_______________________ represents an attribute that does not have a deviation (e.g. Is the purchase order approved?).

_______________________ represent an attribute with a deviation (e.g. an unapproved purchase order).

For this control, we discuss that 2-8% would be the amount of error we can tolerate. Each person in your group should select a different percent.

As we have a small sample of items to test, your sample size has been determined by firm policy. You will each select 10 items from your population (each person should do this separately).

#no deviation______ #deviation_______ #total sample__10________

Calculate your sample deviation rate: # deviation______/#total_10_____=______%.

Compare your sample deviation rate with your selected tolerable error.

Sample Deviation Rate Circle Tolerable Deviation Rate

________ < = > __________

I will/will not rely on this internal control.

Group Results

Name: Rely Do not Rely

Name: Rely Do not Rely

Name: Rely Do not Rely

Name: Rely Do not Rely

Name: Rely Do not Rely

Should we have relied on this control? Lets see.

If you remember, we created a population with a known deviation rate. In our example, we have 7 deviations in a total 100 items. Thats a 7% deviation rate.

Could we rely on the controls in this population? Note that we usually can never observe the whole population. In this case we can and we can see if the sampling worked as we expected.

How many times did we make the correct decision? _____

How many times did we make an incorrect decision? _____

How many times did we over-rely on the controls? ______ (i.e. We relied on the controls when we should not).

How many times did we under-rely on the controls?_____ (i.e. We did not rely on the controls when we should have).