The use of statistical sampling techniques in an audit of financial statements does not eliminate judgmental decisions. Required:

Identify and explain four areas in which judgment may be exercised by CPAs in planning a statistical test of controls.

Assume that the auditors' sample shows an unacceptable deviation rate. Discuss the various actions that they may take based upon this finding.

A nonstratified sample of 80 accounts payable vouchers is to be selected from a population of 3,200. The vouchers are numbered consecutively from 1 to 3,200 and are listed, 40 to a page, in the voucher register. Describe four different techniques for selecting a random sample of vouchers for inspection.