Non-Statistical Sampling
Non-statistical sampling, also known as judgmental or haphazard sampling, is a sampling method that does not rely on the random selection of items from a population. Instead, it relies on the judgment of the auditor or researcher to select items that they believe to be representative of the population.
In non-statistical sampling, the auditor or researcher might choose to select items that are easily accessible, significant in value, or that they believe may contain errors based on their professional judgement and experience.
There are several types of non-statistical sampling methods, including:
- Haphazard Sampling: The selection of items without any specific plan or method. This is often used when the auditor believes the population to be homogeneous and therefore any item is as good as any other.
- Judgment Sampling: The auditor uses their professional judgment to select items that they believe are most likely to contain misstatements or errors.
- Block Sampling: The auditor selects a block or sequence of items from the population. This method assumes that the selected block is representative of the entire population, which may not always be the case.
While non-statistical sampling can be more convenient and less time-consuming than statistical sampling, it also has limitations. The results may not be statistically representative of the population, and there is a risk of bias in the selection and interpretation of the sample. It also doesn’t allow for a statistical estimation of the sampling risk. Because of these limitations, the results of non-statistical sampling should be interpreted with caution.
Example of Non-Statistical Sampling
Let’s consider an example of an auditor conducting an audit of a company’s financial statements.
Suppose the auditor wants to verify the company’s accounts receivable. The company has thousands of customers and it would be impractical to check every single receivable, so the auditor decides to use non-statistical sampling.
- Haphazard Sampling: The auditor might select random invoices to review without following a particular pattern. They might just go through the stack of invoices and pick some here and there.
- Judgment Sampling: The auditor may use their professional judgment to select specific accounts for review. For example, they might decide to focus on accounts that are past due, large dollar accounts, or accounts with a history of payment issues, based on their experience that these types of accounts are more likely to have errors or issues.
- Block Sampling: The auditor may decide to check all accounts receivable from a certain period (for example, all invoices issued in the month of June).
In each of these cases, the auditor is not using a statistical method to select the sample, but rather is relying on convenience, professional judgment, or an arbitrary selection method. While this can save time and resources, the risk is that the selected sample may not be representative of the entire population, and therefore the results of the audit may not accurately reflect the overall condition of the company’s accounts receivable.
