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CMA Intermediate · Corporate Accounting and Auditing · Audit Sampling, Audit Techniques and Analytical Procedure

In a test of controls, the auditor finds that the sample results have not provided a reasonable basis for conclusions about the population. Which response is consistent with SA 530?

The auditor may tailor further procedures, for example by extending the sample size, testing an alternative control or modifying related substantive procedures. SA 530 gives these responses when sampling has not provided a reasonable basis; ignoring results or discarding deviations is not acceptable.

  1. AIgnore the result because sampling risk is unavoidable
  2. BExtend the sample size, test an alternative control or modify related substantive proceduresCorrect
  3. CConclude the control operates effectively as the sample was random
  4. DReduce the sample to the items that had no deviations

Explanation

SA 530 says the auditor may tailor the nature, timing and extent of further procedures. For tests of controls, examples are extending the sample size, testing an alternative control or modifying related substantive procedures. Ignoring the result or dropping deviating items would not give the required assurance.

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