During the Devon Energy audit, you choose to test one of the controls using sampling. Please answer the following questions regarding the application of sampling for this test of control.

16a. Because Devon Energy is a public company audit, we want to obtain a very high level of assurance (not "high", but "very high"). Therefore, what confidence level will we use to calculate the necessary sample size?

16b. We can tolerate a 4 percent deviation rate and expect a 1 percent deviation rate. Using this information, we calculate a necessary sample size of 156 items. We find that the control failed in 5 instances for a sample deviation rate of 3.2 percent. The allowance for sampling risk is 3.7 percent. Based on this information, what is your conclusion regarding the controls operating effectiveness, and why?

DEVON ENERGY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS See accompanying notes to consolidated financial statements. DEVON ENERGY CORPORATION AND SUBSIDIARIES