parallel simulation
#NAME?
integrated test facility
#NAME?
embedded audit modules
#NAME?
test data
processed by clients computer programs under the auditor's control
mapping
monitors execution of a program
online inquiry
allows auditor or other authorized peronnel to select and view individual records and transactions
Difference estimation
#NAME?
ratio estimation sampling
#NAME?
Stratified Sampling
#NAME?
economic order quantity
enables client to minimize inventory carrying costs but does NOT assist auditor in verifying inventory quantity on hand or quality
-EFFICIENT - not effective
source code comparison program
compares the coding of the program from its last run with the original program testing for any unauthorized changes in the program
attribute sampling
...
Variables sampling
-testing the $ amount
-value in sample gives info about ENTIRE pop
MAXIMUM tolerable rate
rate above which the auditr would place less than full reliance on controls being evaluated
system sampling
-every certain # of a pop is selected
-pop needs to be RANDOM
-advantage - pop does NOT require prenumbering
sequential sampling
#NAME?
discovery sampling
testing area so crucial that ZERO pop errors can be tolerated
EX. phony employee on payroll
-used when auditor thinks the pop occurrence rate is NEAR ZERO
Block sampling
easy to implement but WORST method
unrestricted random selection
series of random numbers is identified and the random numers are matched to numbered items in the corresponding population
Methods of sampling used with Statistical sampling
#NAME?
Mean per unit
0
probability-proportional-to-size (PPS)
-OBJECTIVE - ID overstatement errors
-form of variable sampling
-does NOT use standard deviation
-focus = $ amount
-larger or more valueable items often picked more
-projected mistatement? If mistatement found, project to remainder of pop
variables sampling vs PPS
variables
-easy to EXPAND
-selecting ZERO and NEGATIVE balance is easy
PPS
-EASIER to use
-results STRATIFIED
-results in SMALL sample size
-easy to design
sampling for substantive tests
#NAME?
sampling for tests of controls
attribute sampling
check digits
#NAME?
code review
#NAME?
Structured Query Language (SQL)
Relational Database
-group related spreadsheet
-retrieds ingo through quries
Data Definition Language
-defines data base
-gives info on database structure
-maintains tables - can be joined together
-established database contraints
Data Manipulation Langua
Limit test
examines data and looks for reasonableness using upper and lower limits
Test data method
#NAME?
Normal distribution
#NAME?
Standards deviation
measure EXTENT to which the values of the item are spread about the mean
mean
measure of central tendency obtained by totaling all the values and dividing by the # of items