Module E Class Notes Flashcards
0
Q
What are 2 options with variable sampling if number falls outside
the threshold?
A
1 perform more substantive procedures
Or
2 adjustment entry to adjust account balance
1
Q
Variable sampling uses…
A
Dollars
2
Q
Block sampling example of 1000 checks
A
Look at checks written in June, September and January
3
Q
How can you make block sampling more effective?
A
Use more blocks
Make them further apart
4
Q
Example of a key control in attributes sampling?
A
Proper approval
5
Q
What account is commonly used in variable sampling?
A
A/R
6
Q
Before auditors use a sample, they want to get a sense that it’s…
A
Representative
7
Q
Item of interest
A
Has unique identifying characteristic
Ex. Number on check
8
Q
In most cases, substantive testing has to be done on…
A
The balance sheet date
