Which of the following best illustrates the concept of sampling risk?
A) The documents related to the chosen sample may not be available for inspection.
B) An auditor may fail to recognise deviations in the documents examined for the chosen sample.
C) An auditor may select audit procedures that are not appropriate to achieve the specific objective.
D) A randomly chosen sample may not be representative of the population as a whole for the characteristic of interest.

Question

Quizplus · Accepted Answer

Sampling risk refers to the possibility that the sample selected for audit testing may not be representative of the population as a whole for the attribute being tested. This risk can arise if the auditor selects a sample that is too small or if it is not selected randomly. Choice A is an example of non-sampling risk as it is related to the availability of documents rather than the selection of a sample. Choice B is an example of detection risk, which is the risk that the auditor will fail to detect a material misstatement. Choice C is an example of procedural risk or planning risk, which refers to the risk associated with the design and implementation of audit procedures.

Which of the Following Best Illustrates the Concept of Sampling