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Governance, Risk, Audit & Privacy · Intermediate

Sampling Risk

Risk that the auditor's conclusion based on a sample differs from the conclusion if the entire population were tested.

Definition

Sampling risk is a component of detection risk and can be reduced by increasing sample size or using statistical sampling to quantify it. Nonsampling risk arises from other auditor errors, such as using inappropriate procedures.

Example

A sample of 10 shows no errors, but the population actually has a 6 percent error rate.

Exam tip

Use 100 percent testing via data analytics to eliminate sampling risk when feasible.

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