Statistical Sampling for Tests of Controls Compliance and Fraud
We are pleased to launch Statistical Sampling for Tests of Controls, Compliance and Fraud Training in Dubai Abu Dhabi UAE.
It has been proven that, in many instances, auditors take JUDGEMENT samples which are bigger than the STATISTICAL sample they could have taken!
Auditors should have a “controls and process” focus, thus ATTRIBUTE sampling (not dollars) is the correct method for testing controls (according to the IIA, ISAs, AICPA et al.).
Yes, learning statistics was likely painful (for most folks), but it doesn’t have to be! In this course you will utilize a proven freeware package (windows based) which allows for click-and-drag stat sampling. We’re not just talking statistical selection here, but full-blown statistical projections of your audit results to the population.
Many auditors look at “symptoms” (e.g. an invalid Procurement Card transaction); we’ll focus on root causes…that is, “let’s efficiently and effectively TEST the underlying control!” Thus we’ll be well positioned for QUICK RESPONSE AUDITING and exceeding the new COSO (monitoring management’s risk appetite).
In this class we’ll discuss error projection, and error isolation. We will bridge from our planning and analytics, to EXTENT OF TESTING.
This course will provide several takeaways, including the 13 steps of (any) sampling, a decision tree to help select the best sampling method, discussions of Alpha and Beta risk, work-papers for drilling-down to assertion level sampling and multiple methods of how to “pull” your sample.
To further enhance your understanding of the course, you can click here to view the video.
Who Should Attend
- ALL auditors: financial, process/operational, compliance, fraud/waste/abuse, IT, efficiency, program, performance.
- Anyone who has to determine sample sizes and/or whether controls are operating effectively. Anyone who needs to know a) What’s my sample size? and b) Is this “in” or “out” of control?
As this class is 100% hands-on, with several computerized cases, participants will be required to bring their own laptop to class. A free software will be made available during the program.
Upon completion of this course participants will be able to:
- Distinguish among multiple sampling methodologies.
- Tie risk to sample size, at the individual assertion level.
- Re-examine the Standards.
- Refresh concepts of sample risk and “representativeness.”
- Use a decision tree match the method to your audit requirements.
- Review several research studies addressing the values for the parameters of attribute sampling.
- Discover statistical sample sizes SMALLER than judgment sample sizes.
- Examine the new kid … Stop & Go sampling.
- Recognize the three key conditions which encourage judgment sampling.
- Perform sensitivity analysis to see the impact of parameters on sample size.
- Better explain to the auditee what you are/are not saying in your results.
- Perform scientific projection of errors to the population.
- Satisfy of the COSO requirement for monitoring via Stop & Go sampling.
Risk Analysis: The Engine that Drives an Audit
- Risk Assessment (the “dog”) and Sample Size (the “tail”)
- AICPA/IIA/ISA Standards and the Ultimate Risk Model
Statistics … A Primer
- Sampling is Really Easy
- Judgment vs. Statistical Sampling
- Arguments for Judgment Sampling in Certain Situations
Basics of Sampling
- Estimate of μ (“MU”) … the Mean is a Dangerous Number
- Estimate of Dispersion and of Sampling Risk
- Distributions: Normal, Binomial, Hypergeometric, Poisson
- Alpha & Beta Risk
- The Sampling Unit or “Frame” … How to Know your Data
- The 13 Steps in Sampling
- Methods of Selection: Random, Skip, Haphazard, and Block
Compliance Sampling (Attribute Sampling)
- A Decision Tree to Select the Most Efficient Sampling Technique
- Fixed-Sample Approach
- Stop-And-Go Approach
- Discovery Approach
- Attribute Estimation Approach
- Research/Guidance on the Quantification of Alpha & Beta Risk
- Scientific Sample Projection to Population
- Life After Sampling
Most Commonly Asked Questions Regarding Sampling
- What if a Sample Selection is Missing?
- May I Test Multiple Attributes on One Document?
- Is There an Acceptable Minimum Statistical Sample Size?
- Must All Controls Be Tested at Same Risk Level?
- What Can Go Wrong in Sampling?
- Don’t Use PPS to Select Compliance Items …“Coverage!”