AUDIT SAMPLING FOR TESTS OF CONTROLS

Financial statements audit allows auditors to track their truthfulness and objectivity in order to minimize the risk for the users of financial statements who make their business and investment decisions on the grounds of financial ability and profit-gaining capacity of the company. The danger of inappropriate audit opinion is always present. In order to avod this danger, auditors have to gather enough qualitative evidence. Audit sampling is the method used among auditors to form their opinion on the grounds of the evidence gathered. By using audit sampling method auditors should gather enough competent evidence leading to a reasonable basis for their conclusions.

Audit sampling is used for various tests of controls. Auditors use samples to test internal controls, accounting system adequacy and completeness of transactions and immediate review of validity of account balances. This paper deals with the procedure of selection and specifities of sample validation in testing the adequacy of establishing and implementation of controls in the system of internal control of the company.

Key words: sampling, test controls, control risk too low, control risk too high, Tolerable Deviation Rate, Expected Population Deviation Rate, sample selection

JEL Classification: M42