American Journal of Applied Sciences

Mathematical Optimum of the Audit Sample

Georgeta Ancuta Span and Irimie Emil Popa

DOI : 10.3844/ajassp.2012.1290.1293

American Journal of Applied Sciences

Volume 9, Issue 8

Pages 1290-1293


Problem statement: The primary objective of any audit mission is to obtain a high level of assurance on the fact that financial statements are prepared in accordance with a general financial reporting framework. Getting an absolute level of assurance is not possible due to the complexity and big number of transactions and operations found in practice. This research aims to identify the shortcomings of one of the sampling methods used by the Romania auditors (80/20 method) and it was proposed a mathematical function that leads to more appropriate results. Approach: Two examples were analyzed in order to highlight the importance of the proportion of operations in determining the mathematical optimum. The shortcoming of 80/20 sampling method and the need for a mathematical optimum was shown through a general hypothetical case study. Results: Determining the proportion of small or big operations in an entity`s total transactions is not an arbitrarily decision, it has an optimal value depending on the accepted probability distribution of the operations value. Conclusion: Audit sampling depends on several parameters and has to fit a certain audit budget.


© 2012 Georgeta Ancuta Span and Irimie Emil Popa. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.