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A hands on approach to audit techniques for Auditors

About Sampling

In auditing, sampling means applying testing procedures to less than 100% of the population and assess certain characteristics of the sample to support the audit conclusions

Non Statistical Sampling

Probably the most common audit sampling technique. The audit team selects a sample based on its professional judgement instead of applying a rigorous mathematical approach.

Statistical Samplings

It is a structured approach based on probabilistic calculations which allows the audit team to draw conclusion on the entire population on the basis of the examined sample

Why use a statistical sampling approach

Statistical Sampling enables the audit team to define the sample size and to measure the sampling risk.
Attribute Sampling is a statistical sampling technique commonly used in auditing to evaluate the effectiveness of internal controls, also known as tests of controls. This method involves examining a sample of items from a population to determine the presence or absence of certain attributes or characteristics, such as compliance with specific procedures or the occurrence of errors. Attribute Sampling allows auditors to draw conclusions about the overall effectiveness of internal controls based on the results observed in the sampled items. By assessing the frequency or rate of occurrence of attributes within the sample, auditors can make informed judgments about the reliability of internal control processes and identify areas for improvement or further investigation.

There are two main types of Attribute Sampling

  • Acceptance Sampling: used to assess whether the rate of a particular error falls within an acceptable limit.
  • Estimation Sampling: used to estimate the error rate present in the whole population

In the Sampling pages of this site you will find the following types of statistical tools:

Acceptance Sampling:

  • Fixed-Size Sampling: will allow to define a sample size appropriate to determine if the error rate in the population is within an acceptable level
  • Discovery Sampling: used to identify very rare errors (Fraud, AML events,...)
  • Stop or Go Sampling: a multi-step/progressive sampling approach designed to minimize the sample size and... the auditors' work!

Estimation Sampling:

  • Rate Estimation Sampling: a sampling technique to estimate the rate of exceptions in the population

Sampling Evaluation:

  • Sample Evaluation: will analyze the results of the examined samples to compute error limits and confidence

Sample Selection:

  • Random Number Sample Selection: generates a random sample with No Replacement option. The most appropriate selection technique for statistical sampling
  • Systematic Sample Selection: allows you the select 1 to 5 strings of samples based on a module. Still a valid statistical selection technique which eases retrieving items from large populations

Sampling Wizards:

  • Sample Sizing Wizard: a question driven decision tree which facilitates the selection of the most appropriate sampling technique for your situation
  • Sample Selection Wizard: a question driven decision tree to select the most appropriate sample selection technique