Sampling Method
MUS is standard for substantive overstatement testing. Classical is used when items are similar in size or when testing for understatement.
↳ ISA 530.A4 — items are selected proportional to their monetary value. Larger items have a higher probability of selection. Standard for overstatement testing.
Confidence Level
Reflects the assessed risk of material misstatement. Higher confidence = larger sample.
↳ Risk of incorrect acceptance: 10%. Confidence factor (CF): 2.31.
Population & Materiality
Enter the total monetary value of the population being sampled and the materiality thresholds from your planning.
Total monetary value of the account or class of transactions
Typically performance materiality or a fraction of it
Prior year misstatements or current estimate. Leave blank or enter 0 if none.
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Sampling Considerations for Healthcare
Healthcare audits combine high-volume patient billing transactions with complex funding arrangements (government grants, insurance reimbursements, self-pay). Revenue recognition requires testing across multiple payer types, each with different contractual terms, approval processes, and timing considerations.
Sampling focus: Healthcare
Patient revenue sampling should be stratified by payer type — government-funded, insurance, and self-pay streams each carry different risk profiles. For publicly funded healthcare entities, grant compliance testing uses attribute sampling to assess adherence to funding conditions. Pharmaceutical and medical equipment inventories require both existence and valuation testing.
Key sampling considerations
Stratify revenue populations by payer category (government, insurance, self-pay) because each has different recognition timing, approval workflows, and collection risk. Insurance claim adjustments and denials are common — sample claims to test whether revenue is being recognised net of expected adjustments. Grant-funded expenditure requires attribute sampling to test compliance with specific conditions — non-compliance can trigger clawback provisions. Pharmaceutical inventory has expiry date risk — sample items to verify that provisions for expired or near-expiry stock are adequate. Capital equipment often involves donated assets or government-funded purchases — sample additions to verify correct recognition, valuation, and any restrictions on use.
ISA 530.5 — Audit sampling means applying audit procedures to less than 100% of items within a population so that all sampling units have a chance of selection.
ISA 530.A4 — MUS uses monetary units as the sampling unit, giving each monetary unit an equal probability of selection.
ISA 530.A11 — Sample size is affected by the tolerable misstatement, expected misstatement, and the required level of confidence.