Audit and Assurance 2025 – 400 Free Practice Questions to Pass the Exam

Sampling risk in auditing primarily refers to the risk that the sample selected to represent the entire population does not accurately reflect the characteristics of that population. When auditors use sampling techniques to evaluate evidence or test controls, they inherently accept a level of uncertainty that the results obtained from the sample may lead to incorrect conclusions about the entire population.

For example, if an auditor selects a sample of transactions for testing, there is a possibility that the specific transactions chosen do not represent the broader pool of transactions in terms of accuracy or compliance. This misrepresentation can lead the auditor to make inappropriate decisions or assessments regarding the total population, potentially affecting the overall audit opinion.

The other options touch on relevant concepts within auditing but do not capture the essence of sampling risk as precisely. The likelihood of missing key information can relate to both sampling and non-sampling risks. Statistical error pertains to broader statistical anxieties rather than specifically to the representativeness of the sample. Lastly, the risk of fraud pertains more to the underlying integrity of the data or controls rather than the sampling technique itself. Thus, the emphasis on the representativeness of the sample aligns most closely with the definition of sampling risk in the context of auditing.