An auditor is determining the sample size for a test of controls. Which of the following changes would result in a DECREASE in sample size?

Answer options:

An increase in the expected population deviation rate.

A decrease in the risk of assessing control risk too low.

An increase in the tolerable deviation rate.

An increase in the population size (for a large population).

How to approach this question

Sample Size Drivers: Risk (Inverse), Tolerable Error (Inverse), Expected Error (Direct). <br/>Want smaller sample? Accept more risk or more error.

Full Answer

C.An increase in the tolerable deviation rate.✓ Correct

There is an inverse relationship between the tolerable deviation rate and sample size. If the auditor is willing to accept a higher rate of error, they can test fewer items.

Common mistakes

Confusing Expected Rate (Direct) with Tolerable Rate (Inverse).

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