Audit test

An audit test is a sample taken from a larger population, with the intent of testing the sample for certain characteristics, which are then extrapolated to the entire population. For example, if a sales tax audit uncovers $100 of unremitted sales tax in an audit test of 1% of all billings to customers, the $100 outcome is extrapolated to estimate that the entire population of billings contains $10,000 of unremitted sales taxes. Audit tests can greatly reduce the amount of work required by an auditor in the conduct of an audit.

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How to Conduct an Audit Engagement