Which of the following best describes the auditors' response to a client's use of statistical sampling techniques to estimate the inventory?
A)The auditors should satisfy themselves as to the statistical validity of the technique,and the reasonableness of the allowance for sampling risk and sampling error used.
B)The auditors should qualify their opinion,because the client must perform a complete count of the inventory.
C)The auditors should increase the extent of their test counts to compensate for the use of a statistical technique.
D)The auditors should withdraw from the engagement.

Question

Quizplus · Accepted Answer

The auditors should satisfy themselves as to the statistical validity of the technique and the reasonableness of the allowance for sampling risk and sampling error used. In other words, the auditors need to make sure that the statistical sampling technique used is appropriate and that the client has taken into account the possibility of error in the sampling process. This does not necessarily mean that the auditors need to perform a complete count of the inventory or increase the extent of their test counts, nor does it mean that they should automatically qualify their opinion or withdraw from the engagement.

Which of the Following Best Describes the Auditors' Response to a Client's