Judgmental sampling, Auditing

Judgmental Sampling

The Judgement sampling is where, auditor using his own experience and awareness of the client's business and situations selects the sample to be tested with no use of any mathematical or statistical equipments. Statistical sampling is the drawing of inferences around a large volume of data by an inspection of a sample using statistical techniques in its selection.

The benefits of judgment sampling:

  • The approach is fine understood and has been cultured by experience over several years;
  • The auditor is provided a chance to bring his judgement and proficiency into play. After all auditing is an exercise in professional judgement;
  • No special information of statistics is needed;
  • No time is wasted playing with mathematics;

 

Its disadvantages are:

  • It is not scientific;
  • It is extravagant and generally too large samples are chosen;
  • You cannot extrapolate the outcomes to the population as an entire as the samples are not representative;
  • Personal bias in choosing the sample is unavoidable;
  • There is no sense to the choice of the sample or its size;
  • The sample choice is so erratic that it cannot be said to have applied to all matter in the year;
  • The conclusions reached are generally vague.

 

Judgement sampling is yet the preferred technique by the majority of auditors and this is defended on the grounds which the auditor is weighing numerous pieces of evidence and is investigating many things at similar time that the entire procedure is too complex to be reduced to easy formulas.

Posted Date: 12/4/2012 5:08:37 AM | Location : United States







Related Discussions:- Judgmental sampling, Assignment Help, Ask Question on Judgmental sampling, Get Answer, Expert's Help, Judgmental sampling Discussions

Write discussion on Judgmental sampling
Your posts are moderated
Related Questions

Checking consolidation papers The auditor pays particular attention to the calculation of: Goodwill arising on acquisition and consolidation Pre-acquisition and post-

The Accounting System ISA 400 Risk Assessment and Internal Control accounting system are the sequence of tasks and records of an entity by which transactions are procedure as a

Explain appropriate audit procedures you would apply in verification of cheque payments.


Advantages and Disadvantages of a Continuous Audit Advantages: The regular or continual attendance of the auditor might act as a deterrent to scam; Weaknesses in the

Forms of Evidence Observation , is mostly witnessing internal book-keeping procedures and system control. It involves attendance at wages pay out. Observation of stock-ta

The Tonka Manufacturing Company conducts its annual physical inventory at the end of the calendar year as a result of the auditor's assessment of non-operating internal controls in

B. For the one activity/process you ranked the most significant, identify and evaluate four risks. a. Two of the risk should be high to medium significance, and at least one shoul

e following situations involve a possible violation of the MIA ByLaws (on professional ethics, conduct and practice). For each situation, (1) decide whether or not the Code has bee