If the auditor concludes that the computer upper exception rate (CUER) is 5% at an 8% sampling risk, this means that the exception rate in the population is no greater than 5% with an 8% risk of the exception rate exceeding 5%.

Question

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This statement is accurate. The CUER is an estimate of the exception rate in the population. An 8% sampling risk means that there is an 8% chance of the sample failing to detect an exception rate greater than the CUER in the population. Therefore, if the auditor concludes that the CUER is 5% at an 8% sampling risk, it means that the auditor is 92% confident that the exception rate in the population is no greater than 5%.

If the Auditor Concludes That the Computer Upper Exception Rate