Sample selection Before procedures using statistical or non-statistical sampling methods begin, the auditor must determine how the sample will be selected. Discuss the various types of sample selection, when they are used and, generally, how they are used. Give examples
Random number selection
Random number selection is an efficient use of sample selection if random numbers can be related to the population. An example of this is in sampling customer invoices that are sequentially numbered. The sequence can be used as the range for random number selection. Random selection is known to be representative of the population and is required for statistical sampling methods.
Systematic selection
Systematic selection is also a random technique and is acceptable for statistical methods. It is used when sequential numbering is not used in the population or is difficult to use for sampling. An example of this is in sampling inventory for valuation. If the database table keeps inventory items by a unique product number that has alphanumeric characters, then the product number can be used with systematic selection. However, in order to use systematic selection the auditor must (a) establish that the population is complete, and (b) be sure that there is not a systematic pattern in the population. An interval must be used to sample every nth item in the population. Every item in the population then has an equal chance of being selected.
Haphazard selection
Items may be arbitrarily selected from the population using no conscious basis. This haphazard selection process is not considered random and is not used in statistical methods.
Block sampling
Similar to haphazard selection, the auditor may wish to select all transaction in a given day or week. This selection process may not give the auditor the representation of the transactions as they occurred for a more extended period of time.
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