CPA Exam — AUDPerforming Further Procedures and Obtaining EvidenceMedium
An auditor uses non-statistical sampling for tests of controls. Which of the following is a limitation of non-statistical sampling compared to statistical sampling?
- ANon-statistical sampling is more costly to apply due to complex calculations.
- BNon-statistical sampling cannot be used for tests of controls.
- CNon-statistical sampling does not allow the auditor to quantify sampling risk.
- DNon-statistical sampling requires a larger sample size than statistical sampling.
Show answer & explanationAnswer & explanation
Correct answer: C. Non-statistical sampling does not allow the auditor to quantify sampling risk.
A key advantage of statistical sampling is its ability to quantify sampling risk, allowing the auditor to objectively measure the risk of drawing an incorrect conclusion. Non-statistical sampling, while often more judgmental and potentially efficient for certain situations, does not provide this quantitative measure of sampling risk.
Why the other options are wrong
- A. Statistical sampling often involves more complex calculations, making it potentially more costly to design and execute.
- B. Non-statistical sampling can be and is commonly used for tests of controls.
- D. Not necessarily true; non-statistical sampling might use smaller or larger samples depending on judgment.
Non-Statistical vs. Statistical Sampling
Statistical sampling uses mathematical theory to design the sample and evaluate results, allowing for quantification of sampling risk. Non-statistical sampling relies on auditor judgment.
- Statistical sampling provides an objective measure of sampling risk.
- Non-statistical sampling often allows for greater flexibility and judgment in sample selection.
- Both methods can provide sufficient appropriate audit evidence if properly applied.
Memory trick: Sampling: Stat is Math, Non-Stat is Path (Judgment).