Consider each of the following results from tests of controls performed during an audit.

Purchases The auditor used non-statistical sampling techniques to determine an appropriate sample size of 20 in testing a key control over the proper authorisation of purchases. After randomly selecting 20 purchase transactions, the auditor undertook appropriate testing and identified that three of the 20 transactions were not properly authorised.

Sales The auditor used attribute sampling techniques to test a key authorisation control over sales. For a five per cent risk of overreliance, a tolerable deviation rate of 10 per cent and an expected population deviation rate of zero, the auditor determined the minimum sample size to be 29. The auditor selected 29 items using a systematic sampling technique and, on undertaking the audit testing, found that one transaction was not properly authorised.

Required

For both tests performed, discuss the relevant issues in determining whether the auditor can place reliance on the controls.