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Considering each independently, a change in which of the following sample planning factors would influence the sample size for a substantive test of details for a specific account?

Expected Misstatement, Tolerable Misstatement
a) Yes, No
b) No, Yes
c) Yes, Yes
d) No, No

1 Answer

1 vote

Final answer:

A change in the Expected Misstatement or the Tolerable Misstatement would influence the sample size for a substantive test of details for a specific account. If the Expected Misstatement increases, the sample size would also need to increase. Similarly, if the Tolerable Misstatement decreases, the sample size would need to increase.

Step-by-step explanation:

A change in the Expected Misstatement or the Tolerable Misstatement would influence the sample size for a substantive test of details for a specific account. If the Expected Misstatement increases, the sample size would also need to increase to ensure a higher probability of detecting a material misstatement. Similarly, if the Tolerable Misstatement decreases, the sample size would need to increase to achieve a higher level of precision in the testing.

A lower tolerable misstatement would require a larger sample size to ensure the actual misstatement is under the tolerable level. Conversely, if the tolerable misstatement is higher, the auditor might accept a smaller sample size. Therefore, the answer to the given question would be "c) Yes, Yes" since both factors independently influence the determination of a sample size for an audit.

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