Which of the following courses of action is an auditor most likely to follow in designing a sampling plan for cash disbursements if the auditor is aware of several unusually large cash disbursements?
A)Increase the sample size to reduce the effect of the unusually large disbursements.
B)Continue to draw new samples until all the unusually large disbursements are included in the sample.
C)Set the tolerable deviation rate at a lower level than originally planned.
D)Stratify the cash disbursements population so that all of the unusually large disbursements are selected.

Question

Quizplus · Accepted Answer

Stratifying the cash disbursements population would ensure that all of the unusually large disbursements are selected, rather than relying on chance to include them in the sample. This would increase the likelihood of detecting any errors or fraud related to those disbursements. Increasing the sample size, continuing to draw new samples, or setting a lower tolerable deviation rate would not specifically address the issue of unusually large disbursements.

Which of the Following Courses of Action Is an Auditor