Wiley CPA Review Questions – AUD
Wiley CPA Software
Which of the following is included as part of the definition of audit sampling?
- A: Inquiry and observation procedures..
- B: Documentary evidence.
- C: Evaluation of some characteristic.
- D: Statistical techniques
An advantage of statistical sampling over nonstatistical sampling is that statistical sampling helps an auditor to
- A: Minimize the failure to detect errors and irregularities.
- B: Eliminate the risk of nonsampling errors.
- C: Reduce the level of audit risk and materiality to a relatively low amount.
- D: Measure the sufficiency of the evidential matter obtained.
Which of the following is an element of sampling risk?
- A: Choosing an audit procedure that is inconsistent with the audit objective.
- B: Choosing a sample size that is too small to achieve the sampling objective.
- C: Failing to detect an error on a document that has been inspected by the auditor.
- D: Failing to perform audit procedures that are required by the sampling plan.
Which of the following best illustrates the concept of sampling risk?
- A: A randomly chosen sample may not be representative of the population as a whole on the characteristic of interest.
- B: An auditor may select audit procedures that are not appropriate to achieve the specific objective.
- C: An auditor may fail to recognize errors in the documents examined for the chosen sample.
- D: The documents related to the chosen sample may not be available for inspection.
Which of the following best describes the distinguishing feature of statistical sampling?
- A: It provides for measuring mathematically the degree of uncertainty that results from examining only a part of the data.
- B: It allows the auditor to have the same degree of sampling risk as with nonstatistical sampling but with substantially less work.
- C: It allows the auditor to substitute sampling techniques for audit judgment.
- D: It provides for measuring the actual misstatements in financial statements in terms of sampling risk and allowance for sampling risk.