When should auditors use numerical sampling?

The appropriate use of numerical sampling is generally applicable in audit scenarios where it allows auditors to evaluate a broader range of data efficiently and effectively. This method enhances the reliability and validity of the audit findings across various population sizes rather than being restricted to small populations alone.

Using numerical sampling makes sense as it offers auditors the flexibility to draw meaningful insights from data while balancing the requirements of sampling risk, materiality, and operational efficiency. It incorporates a systematic approach that can be adjusted based on the specifics of the audit, rather than limiting itself to high-risk situations or speed considerations. This practice is rooted in the principle that statistical sampling can yield reliable results even when based on larger datasets, thereby facilitating a more comprehensive examination of transactions and controls.

In contrast, limiting sampling to small populations would not capitalize on potential efficiencies in more extensive data contexts. Also, focusing exclusively on high-risk audits or situations where speed is a priority does not necessarily invoke the comprehensive and methodological benefits that numerical sampling offers in a broader array of audit types.