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12 Cards in this Set
- Front
- Back
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Acceptable Risk of Inocrrect Acceptance (ARIA)
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The risk that the auditor is willing to take of accepting a balance as correct when the true misstatement in the balance is equal to or greater than tolerable misstatement
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Acceptable Risk of Incorrect Rejection (ARIR)
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The risk that the auditor is willing to take of rejecting a balance as incorrect when it is not misstated by a material amount
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Difference Estimation
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A method of variables sampling in which the auditor estimates the population misstatement by multiplying the average misstatement in the sample by the total number of population items and also calculates sampling risk
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Misstatement Bounds
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An estimate of the largest likely overstatements and understatements in a population at a given ARIA, using monetary unit sampling
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Monetary Unit Sampling (MUS)
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A statistical sampling method that provides upper and lower misstatement bounds expressed in monetary amounts; also referred to as a dollar unit sampling, cumulative monetary amount sampling, and sampling with probability proportional to size
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Point Estimate
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A method of projecting from the sample to the population to estimate the population misstatement, commonly by assuming that misstatements in the unaudited population are proportional to the misstatements found in the sample
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Probability Proportional to Size Sample Selection (PPS)
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Sample selection of individual dollars in a population by the use of random or systematic sample selection
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Ratio Estimation
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A method of variables sampling in which the auditor estimates the population misstatement by multiplying the portion of sample dollars misstated by the total recorded population book value and also calculates sampling risk
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Statistical Inferences
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Statistical conclusions that the auditor draws from sample results based on knowledge of sampling distributions
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Stratified Sampling
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A method of sampling in which all the elements in the total population are divided into two or more subpopulations that are independently tested and statistically measured
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Variables Sampling
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Sampling techniques for tests of details of balances that use the statistical inference process
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Mean-Per-Unit Estimation
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A method of variables sampling in which the auditor estimates the audited value of a population by multiplying the average audited value of a population by multiplying the average audited value of the sample by the population size and also calculates sampling risk
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