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SAS
No. 26 Audit Sampling |
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 Status |
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Issued by Auditing Standards Committee in Taiwan on
30 June, 1994. |
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Summary |
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When designing audit procedures, the auditor should determine
appropriate means for selecting items for testing so as to gather
sufficient appropriate audit evidence to meet the objectives of the
audit procedures. |
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Audit sampling involves the application of audit procedures to less
than 100% of items within a class of transactions or account balance
such that all sampling units have a chance of selection. This will
enable the auditor to obtain and evaluate audit evidence about some
characteristic of the items selected in order to form or assist in
forming a conclusion concerning the population from which the sample
is drawn. Audit sampling can use either a statistical or a
non-statistical approach. |
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The auditor should apply professional judgment in designing audit
sampling and take into account the following:
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The relationship of the sample to the relevant audit objective.
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Population and sampling units.
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Risks and confidence level.
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Tolerable error.
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Expected error in the population.
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Stratification. |
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Sampling risk arises from the possibility that the auditor’s
conclusion, based on a sample, may be different from the conclusion
he would reach if the entire population were subjected to the same
audit procedure. |
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Sample items should be selected in such a way that the sample can be
expected to be representative of the population. This requires that
all items in the population have an opportunity of being selected. |
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While there are a number of selection methods, three methods
commonly used are:
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Random selection,
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Systematic selection, and
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Haphazard selection. |
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Random selection ensures that all items in the population or within
each stratum have a known chance of selection. Systematic selection
involves selecting items using a constant interval between
selections, the first interval having a random start. Haphazard
selection may be an alternative to random selection provided that
the auditor attempts to draw a representative sample from the entire
population with no intention to either include or exclude specific
units. |
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Having carried out, on each sample item, those audit procedures that
are appropriate to the particular audit objective, the auditor
should:
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Analyze any errors detected in the sample.
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Project the errors found in the sample to the population, and
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Assess the sampling risk. |
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The auditor should project the error results of the sample to the
population from which the same was selected. When projecting error
results, the auditor should keep in mind the qualitative aspects of
the errors found. |
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The auditor should consider whether errors in the population might
exceed the tolerable error by comparing the projected population
error to the tolerable error and also then compare the sample result
to the evidence obtained from other relevant audit procedures when
forming his conclusions about an account balance, class of
transactions or specific control. |
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Having evaluated the sampling results, the auditor should conclude
as to the extent to which he has obtained sufficient appropriate
audit evidence in support of the particular characteristic of the
account balance or class of transaction with which he is concerned. |
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 Effective
date
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This Statement is effective for audit of financial statements with
fiscal years ending on or after 31 December, 1996. |
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