An auditor plans to examine the supporting documentation for a sample of 20 payments as prescribed by the client's internal control procedures. For one of the payments in the chosen sample of 20, the supporting documentation cannot be found. The auditor should:
A) treat the missing supporting documentation as a deviation for the purpose of evaluating the sample.
B) evaluate the results as if the sample size had been 19.
C) choose another payment to replace the payment with the missing supporting documentation in the sample.
D) treat the missing supporting documentation in the same manner as the majority of the other supporting documentation (i.e. whether it supported the payments or not).

Question

Quizplus · Accepted Answer

The missing supporting documentation should be treated as a deviation and evaluated as such, as it could indicate a weakness in the client's internal control procedures. Choosing another payment to replace the missing one could skew the sample and not accurately reflect the overall control environment. Treating it the same as the majority of the other supporting documentation would not address the issue of the missing documentation. Evaluating the results as if the sample size had been reduced would not accurately represent the overall control environment.

An Auditor Plans to Examine the Supporting Documentation for a Sample