Audit measurement error in substantive hypothesis tests.
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| Other Authors: | , , , |
| Format: | Thesis Book |
| Language: | English |
| Published: |
1983.
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| Subjects: | |
| Online Access: | Link to ProQuest Copy Link to OAKTrust copy |
| Abstract: | A development that has occurred in the last 20 years is the increased use of statistical techniques by auditors. This increased use of statistical procedures has brought a unique set of problems to the auditor, ranging from the simple "how to" problems of calculating statistics to the appropriateness of techniques and interpretation of results. Among these problems is the control of error in the audit process. There are several sources of error (or risk) in the audit process. These are: (1) the risk of material accounting error (or irregularity), (2) system risk and (3) audit risk. The risk of material accounting error and system risk are the object of the auditors investigation. Audit risk, however, is a problem to which the auditor is subject and, therefore, must be controlled by him. Audit risk in the context of audit hypothesis testing can be subdivided into sampling error and audit measurement error. Sampling error has been discussed extensively in the literature and is not the object of this study. Audit measurement error, as defined by this study, will include both the risk that the audit may fail to detect error and the risk that the audit may actually introduce error. The focus of this research was the effect of audit measurement error on the substantive hypothesis test. Specifically, this research explored four points: (1) the determination of the sample size necessary to yield a normal sampling distribution of e, (2) the determination of the effect of measurement error on the sampling distribution of e, (3) the determination of the sufficiency of the effect of measurement error to change the decision of a substantive hypothesis test, and (4) the determination of the usefulness of sample size to control the adverse effects of audit measurement error. Nine audit measurement error distributions were used to simulate the effects of audit measurement error on a substantive hypothesis test. In each experiment it was determined if audit measurement error substantially altered the probability of obtaining the same decision as was obtained without the presence of audit measurement error. |
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| Item Description: | "Major subject: Business Administration." Typescript (photocopy). Vita. |
| Physical Description: | ix, 100 leaves : illustrations ; 29 cm |
| Bibliography: | Includes bibliographical references (leaves 93-99). |