Sampling methods and confidence intervals are routinely used for financial audits of large companies.Which of the following is an advantage of doing it this way, versus having a complete audit of all records?
A)It is much cheaper.
B)A sample can be done more carefully than a complete audit.
C)A well-designed sampling audit may yield a more accurate estimate than a less carefully carried out complete audit or census.
D)All of the above.

Question

Quizplus · Accepted Answer

Sampling methods and confidence intervals offer several advantages over complete audits. They are cheaper because auditing a sample requires fewer resources than auditing every single record. Additionally, because auditors are dealing with a smaller dataset, they can afford to be more meticulous in their examination, potentially leading to a more careful audit. Furthermore, a well-designed sampling method, when executed with precision, can indeed yield more accurate estimates than a complete audit that might be conducted with less attention to detail due to the sheer volume of data.

Sampling Methods and Confidence Intervals Are Routinely Used for Financial