Audit sampling is the application of an audit procedure to less than 100 percent of the items within an account balance or class of transactions for the purpose of evaluating some characteristic of the balance or class. This section provides guidance for planning, performing, and evaluating audit samples. Sampling can either be statistical or non statistical.
The following are methods of selecting an audit sample
- Using random selection of sample items. This method uses probability theory to decide on sample size and measurement of sampling risk
- Systematic selection in which a sampling interval is determined and applied to the population. For example if the sampling interval was 100 then every 100th sampling unit thereafter is selected
- Haphazard selection is where the auditor selects the sample without following a structured techniques. The auditor tries to avoid any conscious bias when selecting the sample to ensure all items in the population have chance of selection.
- Block testing of group of items within population. For example if testing the population that is grouped into monthly batches the auditor may decide to test all items in one or more months.
- Monetary unit sampling this is value weighted technique that places emphasis on items in the population with larger monetary values. This type of testing is useful when testing for overstatement in account receivables balances for example.