When errors are found in a sample, auditors in practice generally make the assumption:
A)of a 100% assumption for all errors.
B)that the population errors are larger than the sample errors.
C)that the population errors are smaller than the sample errors.
D)that the actual sample errors are representative of the population errors.

Question

Quizplus · Accepted Answer

Auditors generally make the assumption that the actual sample errors are representative of the population errors. This assumption is based on the principle of sampling, where a representative sample is selected to provide an accurate estimate of the attributes of the population being audited. Therefore, if errors are found in the sample, it is assumed that there may be similar errors or misstatements in the population. However, the auditor must exercise professional judgment and evaluate the nature and extent of the errors found in the sample to determine the impact on the financial statements as a whole.

When Errors Are Found in a Sample, Auditors in Practice