An auditor selects a sample of 50 for a test of controls and finds two transactions are not processed in accordance with the controls. The tolerable deviation rate was specified as six per cent. Using the extrapolation approach specified in the auditing standards, the sample results:
A) do not support the planned assessed level of control risk.
B) support the planned assessed level of control risk.
C) are indeterminate without more data.
D) None of the given answers.

Question

Quizplus · Accepted Answer

The deviation rate in the sample is 4% (2 out of 50), which is below the tolerable deviation rate of 6%, supporting the planned assessed level of control risk.

An Auditor Selects a Sample of 50 for a Test