审计学：一种整合方法（英文版 第17版）课件汇 CHAPTER 14 Audit of the Sales and Collection Cycle Tests -CHAPTER26-Internal and Governmental

AuditingandAssuranceServicesSeventeenthEditionChapter14AuditoftheSalesandCollectionCycle:TestsofControlsandSubstantiveTestsofTransactionsCopyright©2020,2017,2014PearsonEducation,Inc.AllRightsReservedLearningObjectives(1of2)14.1 Identifytheaccountsandtheclassesoftransactionsinthesalesandcollectioncycle14.2 Describethebusinessfunctionsandtherelateddocumentsandrecordsinthesalesandcollectioncycle14.3 Understandinternalcontrol,anddesignandperformtestsofcontrolsandsubstantivetestsoftransactionsforsales14.4 ApplythemethodologyforcontrolsoversalestransactionstocontrolsoversalesreturnsandallowancesLearningObjectives(2of2)14.5 Understandinternalcontrol,anddesignandperformtestsofcontrolsandsubstantivetestsoftransactionsforcashreceipts14.6 Applythemethodologyforcontrolsoverthesalesandcollectioncycletocontrolsrelatedtouncollectibleaccountsreceivable14.7 UnderstandtheeffectoftestsofcontrolsandsubstantivetestsoftransactionsonsubstantivetestsofdetailsofbalancesLearningObjective14.1IdentifytheaccountsandtheclassesoftransactionsinthesalesandcollectioncycleAccountsandClassesofTransactionsintheSalesandCollectionCycleTherearefiveclassesoftransactionsinthesalesandcollectioncycle:Sales(cashandsalesonaccount)CashreceiptsSalesreturnsandallowancesWrite-offofuncollectibleaccountsEstimateofbaddebtexpenseFigure14.1AccountsintheSalesandCollectionCycleLearningObjective14.2DescribethebusinessfunctionsandtherelateddocumentsandrecordsinthesalesandcollectioncycleBusinessFunctionsintheCycleandRelatedDocumentsandRecords(1of2)Thereareeightbusinessfunctionswithinthesalesandcollectioncycle(1of2):ProcessingcustomerordersGrantingcreditShippinggoodsBillingcustomersandrecordingsalesBusinessFunctionsintheCycleandRelatedDocumentsandRecords(2of2)Thereareeightbusinessfunctionswithinthesalesandcollectioncycle(2of2):ProcessingandrecordingcashreceiptsProcessingandrecordingsalesreturnsandallowancesWritingoffuncollectibleaccountsreceivableProvidingforbaddebtsTable14.1(1of2)ClassesofTransactions,Accounts,BusinessFunctions,andRelatedDocumentsandRecordsfortheSalesandCollectionCycleClassesofTransactionsAccountsBusinessFunctionsDocumentsandRecordsSalesSalesAccountsreceivableProcessingcustomerordersGrantingcreditShippinggoodsBillingcustomersandrecordingSalesCustomerorderSalesorderCustomerorderorsalesorderShippingdocumentSalesinvoiceSalestransactionfileSalesjournalorlistingAccountsreceivablemasterfileAccountsreceivabletrialbalanceMonthlystatementCashreceiptsCashinbank(debitsfromcashreceipts)AccountsreceivableProcessingandrecordingcashreceiptsRemittanceadvicePrelistingofcashreceiptsCashreceiptstransactionfileCashreceiptsjournalorlistingTable14.1(2of2)ClassesofTransactions,Accounts,BusinessFunctions,andRelatedDocumentsandRecordsfortheSalesandCollectionCycle(continued)ClassesofTransactionsAccountsBusinessFunctionsDocumentsandRecordsSalesreturnsandallowancesSalesreturnsandallowancesAccountsreceivableProcessingandrecordingsalesreturnsandallowancesCreditmemoSalesreturnsandallowancesjournalWrite-offofuncollectibleaccountsAccountsreceivableAllowanceforuncollectibleaccountsWritingoffuncollectibleaccountsreceivableUncollectibleaccountauthorizationformGeneraljournalBaddebtexpenseBaddebtexpenseAllowanceforuncollectibleaccountsProvidingforbaddebtsGeneraljournalLet’sDiscuss(1of8)Describethenatureofthefollowingdocumentsandrecordsandexplaintheiruseinthesalesandcollectioncycle:customerorder,salesinvoice,prelistingofcashreceipts,andmonthlystatementtocustomers.Whatistheroleoftheshippingdocumentininvoicingcustomers?Whatarethemostimportantmanagementassertionsrelatedtocustomerbilling?Let’sDiscuss(2of8)BestSsellsfictionandnonfictionbooksande-bookstocustomersthroughthecompany’swebsite.Customersplaceordersforbooksviathewebsitebyprovidingtheirname,address,creditcardnumber,andexpirationdate.WhatinternalcontrolscouldBestSimplementtoensurethatshipmentsofbooksoccuronlyforcustomerswhohavetheabilitytopayforthosebooks?AtwhatpointwillBestSbeabletorecordthesaleasrevenue?LearningObjective14.3Understandinternalcontrol,anddesignandperformtestsofcontrolsandsubstantivetestsoftransactionsforsalesFigure14.2MethodologyforDesigningTestsofControlsandSubstantiveTestsofTransactionsforSalesMethodologyforDesigningTestsofControlsandSubstantiveTestsofTransactionsforSales(1of3)Theauditorusestheinformationobtainedinunderstandingtheclient’sinternalcontroltoassesscontrolriskKeycontrolactivitiesforsalesinclude:AdequateseparationofdutiesProperauthorizationPrenumbereddocumentsMonthlystatementsInternalverificationproceduresMethodologyforDesigningTestsofControlsandSubstantiveTestsofTransactionsforSales(2of3)AuditorsassesscontrolriskanddeterminetheextentoftestsofcontrolsafterkeycontrolsanddeficienciesareidentifiedForeachkeycontrol,oneormoretestsofcontrolsmustbedesignedtoverifyitseffectivenessMethodologyforDesigningTestsofControlsandSubstantiveTestsofTransactionsforSales(3of3)Substantivetestsoftransactionsarerelatedtothetransaction-relatedauditobjectivesDeterminingthepropersubstantivetestsoftransactionsproceduresforsalesisrelativelydifficultbecausetheyvaryconsiderablydependingonthecircumstancesFigure14.3DirectionofTestsofSalesLet’sDiscuss(3of8)Whatthreetypesofauthorizationsarecommonlyusedasinternalcontrolsforsales?Explaintheimportanceofeach.Listthetransaction-relatedauditobjectivesfortheauditofsalestransactions.Foreachobjective,stateoneinternalcontrolthattheclientcanusetoreducethelikelihoodofmisstatements.Let’sDiscuss(4of8)Stateonetestofcontrolandonesubstantivetestoftransactionsthattheauditorcanusetoverifythefollowingsalestransaction-relatedauditobjective:Recordedsalesarestatedattheproperamounts.Listthemostimportantdutiesthatshouldbesegregatedinthesalesandcollectioncycle.Explainwhyitisdesirablethateachdutybesegregated.LearningObjective14.4ApplythemethodologyforcontrolsoversalestransactionstocontrolsoversalesreturnsandallowancesSalesReturnsandAllowances(1of2)Transaction-relatedauditobjectivesareessentiallythesameforcreditmemosasthoseforprocessingsales,withtwonotabledifferences(1of2):MaterialitySalesreturnsandallowancesareoftensoimmaterialthatauditorscanignorethemSalesReturnsandAllowances(2of2)Transaction-relatedauditobjectivesareessentiallythesameforcreditmemosasthoseforprocessingsales,withtwonotabledifferences(2of2):EmphasisontheoccurrenceobjectiveAuditorsusuallyemphasizetestingrecordedtransactionstouncoveranytheftofcashinthecollectionofaccountsreceivablethatwascoveredupbyfictitioussalesreturnsorallowancesLearningObjective14.5Understandinternalcontrol,anddesignandperformtestsofcontrolsandsubstantivetestsoftransactionsforcashreceiptsMethodologyforDesigningTestsofControlsandSubstantiveTestsofTransactionsforCashReceipts(1of2)Auditorsusethesamemethodologyfordesigningtestsofcontrolsandsubstantivetestsoftransactionsforcashreceiptsastheyuseforsales:DeterminekeyinternalcontrolsforeachauditobjectiveDesigntestsofcontrolforeachcontrolusedtosupportareducedcontrolriskDesignsubstantivetestsoftransactionstotestformonetarymisstatementsforeachobjectiveMethodologyforDesigningTestsofControlsandSubstantiveTestsofTransactionsforCashReceipts(2of2)Anessentialpartoftheauditor’sresponsibilityinauditingcashreceiptsistoidentifydeficienciesininternalcontrolthatincreasethelikelihoodoffraudAuditproceduresthataredesignedprimarilyforthediscoveryoffraudinclude:DeterminewhethercashreceivedwasrecordedPrepareproofofcashreceiptsTesttodiscoverlappingofaccountsreceivableLet’sDiscuss(5of8)Whatisthedifferencebetweentheauditor’sapproachinverifyingsalesreturnsandallowancesandthatforsales?Explainthereasonsforthedifference.Explainwhyauditorsusuallyemphasizethedetectionoffraudintheauditofcashreceipts.Isthisconsistentorinconsistentwiththeauditor’sresponsibilityintheaudit?Explain.LearningObjective14.6ApplythemethodologyforcontrolsoverthesalesandcollectioncycletocontrolsrelatedtouncollectibleaccountsreceivableAuditTestsforUncollectibleAccounts(1of2)Theauditor’sprimaryconcernhereisthepossibilityofclientpersonnelcoveringupanembezzlementbywritingoffaccountsreceivablethathavealreadybeencollectedThemajorcontrolforpreventingthisfraudisproperauthorizationofthewrite-offofuncollectibleaccountsAuditTestsforUncollectibleAccounts(2of2)RealizablevalueofaccountsreceivableisoftenasignificantconcernfortheauditorTherearetwoothercontrolstoaddressthis:Thepreparationofaperiodicagedaccountsreceivabletrialbalanceforreviewandfollow-upbyappropriatemanagementpersonnelApolicyofwritingoffuncollectibleaccountswhentheyarenolongerlikelytobecollectedLearningObjective14.7UnderstandtheeffectoftestsofcontrolsandsubstantivetestsoftransactionsonsubstantivetestsofdetailsofbalancesEffectofResultsofTestsofControlsandSubstantiveTestsofTransactions(1of2)Theresultsofthetestsofcontrolsandsubstantivetestsoftransactionshaveasignificanteffectontheremainderoftheaudit,especiallyonsubstantivetestsofdetailsofbalancesIfthetestresultsareunsatisfactory,itisnecessaryto:Doadditionalsubstantivetestingofsales,salesreturnsandallowances,write-offofuncollectibleaccounts,andprocessingcashreceiptsEffectofResultsofTestsofControlsandSubstantiveTestsofTransactions(2of2)Themostsignificanteffectoftheresultsofthetestsofcontrolsandsubstantivetestsoftransactionsinthesalesandcollectioncycleis:ConfirmationofaccountsreceivableThetypeofconfirmation,thesizeofthesample,andthetimingofthetestareallaffectedFigure14.4TypesofAuditTestsfortheSalesandCollectionCycleLet’sDiscuss(6of8)Describewhethertheauditorismoreconcernedabouttheoccurrenceorcompletenessobjectiverelatedtocashreceipts.Howmightthewrite-offofaccountsreceivableincreasetheriskoffraudrelatedtocashreceipts?Let’sDiscuss(7of8)Whatauditproceduresaremostlikelytobeusedtoverifyaccountsreceivablewrittenoffasuncollectible?Statethepurposeofeachoftheseprocedures.Let’sDiscuss(8of8)DianeSmith,CPA,performedtestsofcontrolsandsubstantivetestsoftransactionsforsalesforthemonthofMarchinanauditofthefinancialstatementsfortheyearendedDecember31,2019.Basedontheexcellentresultsofboththetestsofcontrolsandthesubstantivetestsoftransactions,shedecidedtosignificantlyreducehersubstantivetestsofdetailsofbalancesatyear-end.Evaluatethisdecision.CopyrightThisworkisprotectedbyUnitedStatescopyrightlawsandisprovidedsolelyfortheuseofinstructorsinteachingtheircoursesandassessingstudentlearning.Disseminationorsaleofanypartofthiswork(includingontheWorldWideWeb)willdestroytheintegrityoftheworkandisnotpermitted.Theworkandmaterialsfromitshouldneverbemadeavailabletostudentsexceptbyinstructorsusingtheaccompanyingtextintheirclasses.Allrecipientsofthisworkareexpectedtoabidebytheserestrictionsandtohonortheintendedpedagogicalpurposesandtheneedsofotherinstructorswhorelyonthesematerials.AuditingandAssuranceServicesSeventeenthEditionChapter15AuditSamplingforTestsofControlsandSubstantiveTestsofTransactionsCopyright©2020,2017,2014PearsonEducation,Inc.AllRightsReservedLearningObjectives(1of2)15.1 Explaintheconceptofrepresentativesampling15.2 Distinguishbetweenstatisticalandnonstatisticalsamplingandbetweenprobabilisticandnonprobabilisticsampleselection15.3 Selectsamplesusingprobabilisticandnonprobabilisticmethods15.4 DefineanddescribeauditsamplingforexceptionratesLearningObjectives(2of2)15.5 Usenonstatisticalsamplingintestsofcontrolsandsubstantivetestsoftransactions15.6 Defineanddescribestatisticalsamplingforexceptionrates15.7 UsestatisticalattributessamplingintestsofcontrolsandsubstantivetestsoftransactionsLearningObjective15.1ExplaintheconceptofrepresentativesamplingRepresentativeSampling(1of3)Whenselectingasamplefromapopulation,theauditorstrivestoobtainarepresentativesampleArepresentativesampleis:OneinwhichthecharacteristicsinthesampleareapproximatelythesameasthoseofthepopulationRepresentativeSampling(2of3)Inpractice,auditorsneverknowwhetherasampleisrepresentative,evenafteralltestingiscompleteAuditorscanincreasethelikelihoodofasamplebeingrepresentativebyusingcarein:DesigningthesamplingprocessSelectingthesampleEvaluatingthesampleresultsRepresentativeSampling(3of3)Therearetwotypesofrisksthatcanleadtosamplingerrorornonsamplingerror:SamplingriskRiskthatanauditorreachesanincorrectconclusionbecausethesampleisnotrepresentativeofthepopulationNonsamplingriskRiskthattheauditorreachesanincorrectconclusionforanyreasonnotrelatedtosamplingriskLearningObjective15.2DistinguishbetweenstatisticalandnonstatisticalsamplingandbetweenprobabilisticandnonprobabilisticsampleselectionStatisticalVersusNonstatisticalSamplingandProbabilisticVersusNonprobabilisticSampleSelection(1of3)Auditsamplingmethodscanbedividedintotwobroadcategories:StatisticalsamplingNonstatisticalsamplingBothinvolvethreephases:PlanthesampleSelectthesampleandperformthetestsEvaluatetheresultsStatisticalVersusNonstatisticalSamplingandProbabilisticVersusNonprobabilisticSampleSelection(2of3)Therearetwomethodsauditorscanusewhenselectingasample:ProbabilisticsampleselectionNonprobabilisticsampleselectionStatisticalVersusNonstatisticalSamplingandProbabilisticVersusNonprobabilisticSampleSelection(3of3)AuditingstandardspermitauditorstouseeitherstatisticalornonstatisticalsamplingmethodsWhenstatisticalsamplingisused,thesamplemustbeaprobabilisticoneAuditorsmaymakenonstatisticalevaluationswhenusingprobabilisticselection,ButitisneveracceptabletoevaluateanonprobabilisticsampleusingstatisticalmethodsLet’sDiscuss(1of6)Distinguishbetweensamplingriskandnonsamplingrisk.Howcaneachbereduced?Whatarethethreemainphasesofauditsampling?Arethesephasesthesameforstatisticalandnonstatisticalsamplingmethods?LearningObjective15.3SelectsamplesusingprobabilisticandnonprobabilisticmethodsSampleSelectionMethods(1of3)Probabilisticsampleselectionmethodsincludethefollowing(1of2):SimplerandomsampleselectionEverypossiblecombinationofpopulationitemshasanequalchanceofbeingincludedinthesampleSystematicsampleselectionTheauditorcalculatesanintervalandthenselectstheitemsforthesamplebasedonthesizeoftheintervalSampleSelectionMethods(2of3)Probabilisticsampleselectionmethodsincludethefollowing(2of2):ProbabilityproportionaltosizesampleselectionInmanyauditingsituations,itisadvantageoustoselectsamplesthatemphasizepopulationitemswithlargerrecordedamountsSampleSelectionMethods(3of3)Nonprobabilisticsampleselectionmethodsinclude:HaphazardsampleselectionTheselectionofitemswithoutanyconsciousbiasbytheauditorBlocksampleselectionAuditorsselectthefirstiteminablock,andtheremainderoftheblockischoseninsequenceLearningObjective15.4DefineanddescribeauditsamplingforexceptionratesSamplingforExceptionRates(1of2)Auditorsusesamplingfortestsofcontrolsandsubstantivetestsoftransactionstodetermine:WhethercontrolsareoperatingeffectivelyandwhethertherateofmonetaryerrorsisbelowtolerablelimitsTodothis,auditorsestimatethepercent(theoccurrencerateorexceptionrate)ofitemsinapopulationcontainingacharacteristicorattributeofinterestSamplingforExceptionRates(2of2)Auditorsareinterestedinthefollowingtypesofexceptionsinpopulationsofaccountingdata:Deviationsfromtheclient’sestablishedcontrolsMonetarymisstatementsinpopulationsoftransactiondataMonetarymisstatementsinpopulationsofaccountbalancedetailsLet’sDiscuss(2of6)Statewhatismeantbyarepresentativesampleandexplainitsimportanceinsamplingauditpopulations.Explainthemajordifferencebetweenstatisticalandnonstatisticalsampling.Arebothmethodsacceptableaccordingtoauditingstandards?Let’sDiscuss(3of6)Distinguishbetweenprobabilisticselectionandstatisticalmeasurement.Statethecircumstancesunderwhichonecanbeusedwithouttheother.Whatisthepurposeofusingnonstatisticalsamplingfortestsofcontrolsandsubstantivetestsoftransactions?LearningObjective15.5UsenonstatisticalsamplingintestsofcontrolsandsubstantivetestsoftransactionsApplicationofNonstatisticalAuditSampling(1of3)Therearethreephaseswhensamplingfortestsofcontrolsandsubstantivetestsoftransactions:PlanthesampleSelectthesampleandperformtheauditproceduresEvaluatetheresultstoconcludeontheacceptabilityofthepopulationThesethreephasesinvolve14well-definedstepsApplicationofNonstatisticalAuditSampling(2of3)Planthesample:1.Statetheobjectivesoftheaudittest2.Decidewhetherauditsamplingapplies3.Defineattributesandexceptionconditions4.Definethepopulation5.Definethesamplingunit6.Specifythetolerableexceptionrate7.Specifyacceptableriskofoverreliance8.Estimatethepopulationdeviationorexceptionrate9.DeterminetheinitialsamplesizeApplicationofNonstatisticalAuditSampling(3of3)Selectthesampleandperformtheauditprocedures:10.Selectthesample11.PerformtheauditproceduresEvaluatetheresults:12.Generalizefromthesampletothepopulation13.Analyzeexceptions14.DecidetheacceptabilityofthepopulationTable15.1TermsUsedinAuditSamplingTermDefinitionTermsRelatedtoPlanningBlankCharacteristicorattributeThecharacteristicbeingtestedintheapplicationAcceptableriskofoverreliance(ARO)Theriskthattheauditoriswillingtotakeofacceptingacontrolaseffectiveorarateofmonetarymisstatementsastolerable,whenthetruepopulationexceptionrateisgreaterthanthetolerableexceptionrateTolerableexceptionrate(TER)Exceptionratethattheauditorwillpermitinthepopulationandstillbewillingtoconcludethecontrolisoperatingeffectivelyand/ortheamountofmonetarymisstatementsinthetransactionsestablishedduringplanningisacceptableEstimatedpopulationexceptionrate(EPER)ExceptionratethattheauditorexpectstofindinthepopulationbeforetestingbeginsInitialsamplesizeSamplesizedecidedafterconsideringtheabovefactorsinplanningTermsRelatedtoEvaluatingResultsBlankExceptionExceptionfromtheattributeinasampleitemSampleexceptionrate(SER)NumberofexceptionsinthesampledividedbythesamplesizeComputedupperexceptionrate(CUER)ThehighestestimatedexceptionrateinthepopulationatagivenAROTable15.2GuidelinesforAROandTERforNonstatisticalSampling:TestsofControlsPlanned

Reduction

in

Substantive

Tests

of

Details

of

BalancesJudgmentGuidelineAssessedcontrolrisk.Consider:NeedtoissueaseparatereportoninternalcontroloverfinancialreportingforacceleratedfilerpubliccompaniesNature,extent,andtimingofsubstantivetests(extensiveplannedsubstantivetestsrelatetohigherassessedcontrolriskandviceversa)Qualityofevidenceavailablefortestsofcontrols(alowerqualityofevidenceavailableresultsinahigherassessedcontrolriskandviceversa)LowestassessedcontrolriskModerateassessedcontrolriskHigherassessedcontrolrisk100%assessedcontrolriskA

R

OoflowA

R

OofmediumA

R

OofhighA

R

OisnotapplicableSignificanceofthetransactionsandrelatedaccountbalancesthatthe

internalcontrolsareintendedtoaffectHighlysignificantbalancesSignificantbalancesLesssignificantbalancesT

E

Rof4%T

E

Rof5%T

E

Rof6%Note:TheguidelinesshouldrecognizethattheremaybevariationsinA

R

O

sbasedonauditconsiderations.Theguidelinesabovearethemostconservativethatshouldbefollowed.Table15.3(1of2)GuidelinesforAROandTERforNonstatisticalSampling:SubstantiveTestsofTransactionsPlannedReductioninSubstantiveTestsofDetailsofBalancesResultsofUnderstandingInternalControlandTests

ofControlsAROforSubstantiveTestsofTransactionsTERforSubstantive

TestsofTransactionsLargeExcellentsuperoneGoodNotgoodHighMediumLowPercentoramountbasedonmaterialityconsiderationsforrelatedaccountsModerateExcellentsuperoneGoodNotgoodHighMediumMedium-lowPercentoramountbasedonmaterialityconsiderationsforrelatedaccountsTable15.3(2of2)GuidelinesforAROandTERforNonstatisticalSampling:SubstantiveTestsofTransactions(Continued)PlannedReductioninSubstantiveTestsofDetailsofBalancesResultsofUnderstandingInternalControlandTests

ofControlsAROfor

SubstantiveTestsofTransactionsTERforSubstantive

TestsofTransactionsSmallsupertwoExcellentsuperoneGoodNotgoodHighMedium-highMediumPercentoramountbasedonmateriality

considerationsforrelatedaccountsNote:TheguidelinesshouldalsorecognizethattheremaybevariationsinAROsbasedonauditconsiderations.Theguidelinesabovearethemostconservativethatshouldbefollowed.thissituation,bothinternalcontrolandevidenceaboutitaregood.Substantivetestsoftransactionsareleastlikelytobeperformedinthissituation.thissituation,littleemphasisisbeingplacedoninternalcontrols.Neithertestsofcontrolsnorsubstantivetestsoftransactionsarelikelyinthissituation.Table15.4EffectonSampleSizeofChangingFactorsType

of

ChangeEffect

on

Initial

Sample

SizeIncrease

acceptable

risk

of

overrelianceDecreaseIncrease

tolerable

exception

rateDecreaseIncrease

estimated

population

exception

rateIncreaseIncrease

population

sizeIncrease

(minor

effect)Figure15.1SummaryofAuditSamplingStepsauditorsusingnonstatisticalmethodscalculatetolerableexceptionrateminussampleexceptionrateandevaluatewhetherthedifferenceissufficientlylarge.LearningObjective15.6DefineanddescribestatisticalsamplingforexceptionratesStatisticalAuditSampling(1of3)AuditorsusestatisticalsamplingfortestsofcontrolsandsubstantivetestsoftransactionsStatisticalsamplingtoreachaconclusionaboutexceptionratesiscalledattributessamplingTheapplicationofstatisticalattributessamplingfortestsofcontrolsandsubstantivetestsoftransactionshasfarmoresimilaritiestononstatisticalsamplingthandifferencesStatisticalAuditSampling(2of3)Differencesbetweenstatisticalsamplingandnonstatisticalsamplingforexceptionratesinclude:(1)thecalculationofinitialsamplesizesdevelopedfromstatisticalprobabilitydistributionsusingtablesorauditsoftware(2)thecalculationofestimatedupperexceptionratesthatincludesamplingriskusingauditsoftwareortablessimilartothoseforcalculatingsamplesizesStatisticalAuditSampling(3of3)Auditorsbasetheirstatisticalinferencesonsamplingdistributions,whichisafrequencydistributionoftheresultsofallpossiblesamplesofaspecifiedsizethatcouldbeobtainedfromapopulationcontainingsomespecificcharacteristicsEachpopulationexceptionrateandsamplesizehasauniquesamplingdistributionTable15.5ProbabilityofEachExceptionRate—5PercentPopulationExceptionRateandSampleSizeof50Number

of

ExceptionsPercentage

of

ExceptionProbabilityCumulative

Probability00Point0769Point076912.2025.279424.2611.540536.2199.760448.1360.8964510Point0656.9620612Point0280.9880714Point0120OneLearningObjective15.7UsestatisticalattributessamplingintestsofcontrolsandsubstantivetestsoftransactionsApplicationofStatisticalAttributesSampling(1of4)Thestepsforattributessamplingarethesameasthosefornonstatisticalsamplingwithafewexceptions(1of4):SpecifyacceptableriskofoverrelianceTheconceptsarethesame,butthemethodofquantifyingisusuallydifferent.Ratherthanusinghigh,medium,andlow,theauditorwilluseaspecificamountApplicationofStatisticalAttributesSampling(2of4)Thestepsforattributessamplingarethesameasthosefornonstatisticalsamplingwithafewexceptions(2of4):DeterminetheinitialsamplesizeThefactorsthataffecttheinitialsamplesizearethesame,butinattributessampling,theauditorusestablesdevelopedfromstatisticalformulasorauditsoftwaretodeterminetheinitialsamplesizeApplicationofStatisticalAttributesSampling(3of4)Thestepsforattributessamplingarethesameasthosefornonstatisticalsamplingwithafewexceptions(3of4):SelectthesampleTheonlydifferenceinsampleselectionisthatprobabilisticmethodsmustbeusedforstatisticalsamplingApplicationofStatisticalAttributesSampling(4of4)Thestepsforattributessamplingarethesameasthosefornonst