Because of the importance of tests of controls and substantive tests of transactions for acquisitions and cash disbursements, it is common in this audit area to use
A) block sampling.
B) variables sampling.
C) attributes sampling.
D) probability proportional to size sampling.

Question

Quizplus · Accepted Answer

Attributes sampling is the best choice for tests of controls and substantive tests of transactions. This type of sampling is used to assess the rate of occurrence of specific characteristics or attributes in a population. For example, an auditor might test a sample of cash disbursements to determine whether they were appropriately authorized by management. The auditor would select a sample of disbursements and determine whether each one was properly approved. The results of the sample would be projected to the entire population of disbursements. Attributes sampling is appropriate when the population is homogeneous and has a low rate of occurrence of the attribute of interest.

Because of the Importance of Tests of Controls and Substantive