An auditor is preparing to sample a client's customer receivables for overstatement.A statistical sampling method that automatically provides stratification when using systematic selection is
A) Attribute sampling.
B) Ratio-estimation sampling.
C) Monetary-unit sampling.
D) Mean-per-unit sampling.

Question

Quizplus · Accepted Answer

Monetary-unit sampling automatically stratifies the population based on the size of each receivable, with larger receivables having a higher probability of selection. This makes it an efficient method for identifying overstatements in the population, as those are more likely to occur in larger receivables. Attribute sampling and mean-per-unit sampling do not provide automatic stratification, while ratio-estimation sampling is not typically used for testing for overstatements in receivables.

An Auditor Is Preparing to Sample a Client's Customer Receivables