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What is called "Sampling Audit"?

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Question added by VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.
Date Posted: 2014/08/22
Hassan Sardar
by Hassan Sardar , Service Center Official , Board of Revenue, Punjab, Pakistan

Selection of Specific Transactions out of bulk of Transactions and creating a base out of these transactions and performing audit of those transactions....

it helps a lot in perfomring audit of large companies who have a load of transactions and financial documents..

Sampling Audit is the application of an audit procedure to less than100

 Percent of the items within an account balance or class of transactions for the

 

purpose of evaluating some characteristic of the balance or class.

In large companies like multinational giant companies, there are millions of financial transactions. It is therefore practically impossible for the auditor to perform an audit on each and every transacction. The auditors therefore, select significant business transactions for review and detailed scrutiny.

 

The process of random selection of business transactions from general ledger for audit purpose is known as Audit Sampling.

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