ACCA Advanced Audit and Assurance (AAA) Practice Exam

Sampling risk refers to what?

1. The risk of auditor misinterpretation

2. The risk of different conclusions based on a sample

3. The total risk resulting from audit procedures

4. The likelihood of finding no errors in a population

The correct answer is: The risk of different conclusions based on a sample

Sampling risk is fundamentally concerned with the risk that the conclusions drawn from a sample may differ from the conclusions that would be reached if the entire population were examined. When an auditor selects a sample from a larger population, there is always a chance that the sample may not be representative of that population. Consequently, an auditor's opinion could potentially be different based on the information gathered from the sample compared to what would be reached if every item within the population were audited. This type of risk is inherent in statistical sampling in auditing, as the very nature of sampling means that not every item is evaluated. If the sample drawn is biased or not representative, the conclusions reached can lead to incorrect assertions about the overall population, impacting the reliability of the auditor's work. The other options, while they discuss aspects related to auditing and risk, do not effectively capture the essence of sampling risk as defined in auditing standards. The focus here is squarely on the variability in conclusions that may arise due to the restrictive nature of sampling, making this the correct answer.