Types of Audit Sampling

Types of Audit Sampling

1. Random Selection

• Each item has an equal chance of being chosen.
• Use random number tables or computer-generated random numbers.
• Advantage: Unbiased, statistically sound.
• Example: Use Excel to generate random numbers, then select invoices with those numbers.

2. Systematic Selection

• Choose items using a fixed interval.
• Example: Population = 1,000 invoices, sample size = 100.
• Sampling interval = 1,000 / 100 = 10.
• Choose a random starting point, say 7, then select 7, 17, 27, 37, …
• Advantage: Easy to use.
• Risk: If there is a pattern in the population that matches the interval, it may bias the sample.

3. Haphazard Selection

• Auditor selects items without any special pattern, but also without using random method.
• Should avoid bias, but still based on human judgment.
• Example: Auditor “picks some invoices” from the file, trying not to make any obvious pattern.
• Not truly random, but often used in practice.
• Risk: Human bias can still enter.

4. Monetary Unit Sampling (MUS)

• Also called probability-proportional-to-size (PPS) sampling.
• Items with larger amounts (RM value) have higher chance of being selected.
• Useful when auditor is more concerned about overstatement (e.g. receivables).
• Example: An invoice of RM 100,000 more likely to be selected than RM 100 invoice.

5. Block Selection

• Auditor selects a block (group) of items that are next to each other.
• Example: Choose invoices 201–250 (a block of 50).
• Easy to do, but not representative if there is a pattern in the records.
• Usually not preferred for final conclusions, but sometimes used for preliminary work.