An auditor uses statistical sampling for attributes in internal control testing. She would most likely reduce the planned reliable on the control tested when:
A) the sample deviation rate plus the adjustment for sampling risk exceeded the tolerable deviation rate.
B) the sample deviation rate plus the adjustment for sampling risk equaled the tolerable deviation rate.
C) the tolerable deviation rate less the adjustment for sampling risk exceeded the expected population deviation rate.
D) the tolerable deviation rate plus the adjustment for sampling risk was less than the expected population deviation rate.

Question

Quizplus · Accepted Answer

The auditor would reduce the planned reliance on the control tested if the sample deviation rate plus the adjustment for sampling risk exceeded the tolerable deviation rate. This indicates that the control may not be effective in preventing or detecting errors, and the auditor cannot rely on it to provide assurance on the accuracy of the financial statements.

An Auditor Uses Statistical Sampling for Attributes in Internal Control