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Question 215 - IIA-CIA-Part2 discussion

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Which of the following attribute sampling methods would be most appropriate to use to measure the total misstatement posted to an accounts payable ledger?

A.
Stop-or-go sampling
Answers
A.
Stop-or-go sampling
B.
Probability to proportional size sampling
Answers
B.
Probability to proportional size sampling
C.
Classical variable sampling
Answers
C.
Classical variable sampling
D.
Discovery sampling
Answers
D.
Discovery sampling
Suggested answer: B

Explanation:

Probability-proportional-to-size (PPS) sampling, also known as monetary unit sampling, is most appropriate for measuring the total misstatement in an accounts payable ledger. This method is used to determine the likelihood of individual items being selected based on their size, with larger items having a higher probability of being selected. This is particularly useful in identifying overstatements and misstatements in financial records, such as accounts payable, where the monetary value of transactions is a critical factor.

Reference:

Institute of Internal Auditors (IIA), Practice Guide -- Auditing Sampling.

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asked 18/09/2024
Ubeydullah Kara
40 questions
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