Sampling Risk and Nonsampling Risk
Understanding Audit Risk in Sampling
Sampling introduces uncertainty because auditors test only part of a population. In addition, audit failures may occur for reasons unrelated to sampling.
- Larger sample sizes reduce sampling risk.
- Training and supervision help reduce nonsampling risk.
- Professional skepticism reduces audit errors.
Summary
Auditors manage both sampling and nonsampling risks to achieve an acceptably low level of audit risk.