Final answer:
The auditor utilizes audit engagement software to assist in making decisions about audit evidence, including sample size, which varies based on each audit's context and is guided by professional judgment rather than fixed rules by regulatory bodies like the PCAOB.
Step-by-step explanation:
When making audit evidence decisions, audit engagement software can assist the auditor in making evidence decisions (option C). The sample size decisions are not prescribed by the PCAOB as fixed numbers and should not necessarily remain constant from audit to audit. Instead, auditors must use professional judgment and statistical methods to determine sample sizes based on the specifics of the audit engagement, which might include the complexity and risk associated with the populations being tested. Tools such as audit engagement software can help ensure the sample size is appropriate, considering factors such as past experience, statistical criteria, and the requirement for sufficient, appropriate audit evidence.
Sampling variability indicates that samples from the same population will yield different results. However, the larger the sample size, the more likely the sample data will represent the population accurately. Nonetheless, determining the right sample size is crucial for reliability, and auditor judgment plays a significant role in this process, keeping in mind that larger samples tend to yield more reliable results, especially in contexts such as opinion polls or product quality tests. Yet, larger samples may not always be feasible or necessary, depending on the audit circumstances and objectives.