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CS Professional · Internal and Forensic Audit · Internal Audit Tools and Techniques

Internal auditor Meera has 2,000 expense vouchers at Sagar Foods Pvt Ltd and decides to examine every 50th voucher, starting from a randomly chosen voucher number 17. Which risk is most specifically associated with this method?

The main risk of systematic sampling is that a regular pattern in the population may align with the fixed interval, making the sample unrepresentative. The method uses a random start and fixed interval, so it is neither fully judgemental nor a full examination of every item.

  1. APeriodic patterns in the data may coincide with the interval and bias the sampleCorrect
  2. BThe sample can never be representative of high-value items
  3. CEvery item in the population must be physically examined
  4. DSelection depends entirely on the auditor's personal judgement

Explanation

Systematic selection uses a fixed interval (here 2,000/50 = 40 items) after a random start. If the population has a recurring pattern, such as month-end vouchers every 50 items, the sample may be biased. It does not depend on personal judgement, and it does not require examining all items.

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