Statistical sampling and risk analysis in auditing:
This text is aimed at those with responsibilities for audit, risk and control - auditors, finance directors, project accountants, and system designers amongst others. Working under pressure, they need to take account of theory and best practice but strike a balance with the practical demands of thei...
Saved in:
| Main Author: | |
|---|---|
| Format: | Book |
| Language: | English |
| Published: |
Aldershot [u.a.]
Gower
1999
|
| Subjects: | |
| Online Access: | Inhaltsverzeichnis |
| Summary: | This text is aimed at those with responsibilities for audit, risk and control - auditors, finance directors, project accountants, and system designers amongst others. Working under pressure, they need to take account of theory and best practice but strike a balance with the practical demands of their workplace. The author emphasizes the meeting of the ever changing needs of clients and auditees by helping readers: select a suitable, practical sampling approach; appreciate the statistical implications; evaluate the results of audit testing; and take account of risk and control evaluation in targetting valuable audit resources. It does this by laying out the principles behind a concept and then grounding them in "real-life" cases for the reader to work through. These are accompanied by suggested solutions which, while not definitive answers, provide useful advice and guidance This text is aimed at those with responsibility in audit, risk and control. It covers: selecting a suitable, practical sampling approach; appreciating statistical implications; evaluating results of audit testing; and taking account of risk and control in targetting valuable audit resources |
| Physical Description: | XI, 170 S. graph. Darst. |
| ISBN: | 056608080X |
Staff View
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Record in the Search Index
| _version_ | 1804126806245113856 |
|---|---|
| adam_text | Contents
List of figures ix
List of tables x
List of case studies xi
1 Introduction 1
The people this book aims to help 1
The help on offer 2
Reading through and getting the most from this book 3
Recent developments 4
Conclusion 5
2 Statistical and non statistical approaches 7
Is there really a lot of difference between statistical and
non statistical? 7
Main approaches 11
Haphazard 11
Judgmental (selective) 12
Equal interval (or systematic) 13
Statistical 14
Conclusion 15
v
vi Contents
3 Why bother to use statistical sampling? 17
Professional standards 17
Increasing the value of your audit 19
Testing 19
Taking account of risk and materiality 22
Independence 22
Speed and efficiency 23
Making optimal use of information technology 23
Accountability and audit management 23
Potential pitfalls and disadvantages 25
The need for planning 25
Cost of investing in new skills 25
An unrealistic sense of security 26
Conclusion 27
4 Theory, concepts and conditions 29
Probability 29
The normal distribution 30
Precision, confidence and point estimates 31
The reliability factor 33
The population 34
The population characteristic 35
Sampling units 35
Access to the sample (sampling frames) 35
Errors 36
Random (or known chance) selection 37
Conclusion 37
5 Attribute sampling 39
Attribute sample size 40
Sampling interval 40
Case study 1: compliance testing during a stock system
audit 41
Suggestions 42
Case study 2: compliance testing a purchases system 46
Conclusion 49
Contents vii
6 An introduction to monetary unit sampling ( CUS) 51
Substantive or compliance testing and the role of MUS 51
The purpose and pitfalls of MUS 53
Sample size and sampling interval for MUS 54
Some initial precautions 55
Case study 3: external audit of year end creditor s figure 57
Suggestions 57
Case study 4: the internal audit of a creditor s
payment system 60
Suggestions 60
Conclusion 64
7 Monetary unit sampling taking account of errors 67
Two options 67
The safety margin and precision gap widening 68
The mechanics of extrapolation 70
Three main stages of MUS extrapolation 70
Case study 5: MUS with overpayment error 75
Case study 6: MUS overpayments extrapolated beyond
MTEL 76
Case study 7: MUS with over and underpayment error 82
Conclusion 83
8 Risk models and the reduction of sample sizes 87
Risk of what? 89
A simple triangular relationship 90
Using nightmare scenarios to identify key risks 91
Typical key control questions purchasing system 93
The total audit risk model 94
Case study 8: too much work! 96
Case study 9: taking account of wider audit evidence 98
Suggestions 100
Conclusion 104
9 Other sampling approaches 107
Acceptance sampling 107
Combined sample size for attribute and MUS 110
Variables sampling 111
viii Contents
Mean per unit sampling 111
Ratio estimation 112
Difference estimation 112
Conclusion 114
10 Final concluding thoughts 115
How should I introduce statistical sampling to my audit? 115
Appendices 121
1 Additional case studies 123
2 Glossary 141
3 Abbreviations 147
4 SAS 430 149
5 Tables 161
6 Further reading 166
Index 169
List of figures
2.1 Relationship between sample size and reliability 9
4.1 Normal distribution 30
7.1 Precision gap widening 69
7.2(a) MUS Evaluation Sheet 72
7.2(b) MUS Evaluation Sheet 78
7.2(c) MUS Evaluation Sheet 80
7.2(d) MUS Evaluation Sheet 84
8.1 Objectives, risks and controls 90
8.2 Effect of overpayment 102
Appendices
Worksheet 1 136
Worksheet 2 138
ix
List of tables
1.1 Recent developments 5
3.1 SAS 430: Basic principles and essential procedures 19
4.1 Reliability factors 33
9.1 Acceptance sampling 108
9.2 Estimated upper error limits (UELs) to nearest whole
percentage from compliance testing 110
Appendices
4 Table 1 Some factors influencing sample size for tests
of controls 158
Table 2 Some factors influencing sample size for
substantive tests 159
5 Table 1 Random numbers 163
Table 2 Cumulative poisson probabilities 164
x
List of case studies
1 Compliance testing during a stock system audit 41
2 Compliance testing a purchases system 46
3 External audit of year end creditor s figure 57
4 The internal audit of a creditor s payment system 60
5 MUS with overpayment error 75
6 MUS overpayments extrapolated beyond MTEL 76
7 MUS with over and underpayment error 82
8 Too much work! 96
9 Taking account of wider audit evidence 98
xi
|
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| illustrated | Illustrated |
| indexdate | 2024-07-09T18:23:18Z |
| institution | BVB |
| isbn | 056608080X |
| language | English |
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| physical | XI, 170 S. graph. Darst. |
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| spelling | Jones, Peter Verfasser aut Statistical sampling and risk analysis in auditing Peter Jones Aldershot [u.a.] Gower 1999 XI, 170 S. graph. Darst. txt rdacontent n rdamedia nc rdacarrier This text is aimed at those with responsibilities for audit, risk and control - auditors, finance directors, project accountants, and system designers amongst others. Working under pressure, they need to take account of theory and best practice but strike a balance with the practical demands of their workplace. The author emphasizes the meeting of the ever changing needs of clients and auditees by helping readers: select a suitable, practical sampling approach; appreciate the statistical implications; evaluate the results of audit testing; and take account of risk and control evaluation in targetting valuable audit resources. It does this by laying out the principles behind a concept and then grounding them in "real-life" cases for the reader to work through. These are accompanied by suggested solutions which, while not definitive answers, provide useful advice and guidance This text is aimed at those with responsibility in audit, risk and control. It covers: selecting a suitable, practical sampling approach; appreciating statistical implications; evaluating results of audit testing; and taking account of risk and control in targetting valuable audit resources REVISION STATISTISKE METODER STIKPRØVEREVISION Stichprobe (DE-588)4057502-0 gnd rswk-swf Revision Wirtschaft (DE-588)4049674-0 gnd rswk-swf Stichprobe (DE-588)4057502-0 s Revision Wirtschaft (DE-588)4049674-0 s DE-604 Äquivalent Jones, Peter Statistical sampling and risk analysis in auditingPeter Jones 1999 (DE-604)BV044867561 HBZ Datenaustausch application/pdf http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=008260253&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA Inhaltsverzeichnis |
| spellingShingle | Jones, Peter Statistical sampling and risk analysis in auditing REVISION STATISTISKE METODER STIKPRØVEREVISION Stichprobe (DE-588)4057502-0 gnd Revision Wirtschaft (DE-588)4049674-0 gnd |
| subject_GND | (DE-588)4057502-0 (DE-588)4049674-0 |
| title | Statistical sampling and risk analysis in auditing |
| title_auth | Statistical sampling and risk analysis in auditing |
| title_exact_search | Statistical sampling and risk analysis in auditing |
| title_full | Statistical sampling and risk analysis in auditing Peter Jones |
| title_fullStr | Statistical sampling and risk analysis in auditing Peter Jones |
| title_full_unstemmed | Statistical sampling and risk analysis in auditing Peter Jones |
| title_short | Statistical sampling and risk analysis in auditing |
| title_sort | statistical sampling and risk analysis in auditing |
| topic | REVISION STATISTISKE METODER STIKPRØVEREVISION Stichprobe (DE-588)4057502-0 gnd Revision Wirtschaft (DE-588)4049674-0 gnd |
| topic_facet | REVISION STATISTISKE METODER STIKPRØVEREVISION Stichprobe Revision Wirtschaft |
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