Sampling unit definition
/What is a Sampling Unit in Auditing?
A sampling unit is a selection of a population that is used as an extrapolation of the population. Each sampling unit is then placed in a smaller grouping to create a research sample. This grouping is then analyzed to arrive at conclusions about the population from which it was drawn.
Example of a Sampling Unit
For a large corporation, examples of sampling units might include the following:
Individual transactions. A single invoice, payment, or journal entry.
Account balances. A specific balance in accounts payable or accounts receivable.
Line items. An individual entry or detail within a financial statement, such as a line item from an expense report.
Invoices. A randomly selected invoice for testing its accuracy and authenticity.
Vendor accounts. A specific vendor account from accounts payable to verify payment accuracy and compliance with contracts.
Payroll records. A single employee’s payroll record for a particular pay period.
The choice of sampling unit depends on the audit objectives and the population being tested. For example, if the goal is to test the accuracy of recorded revenue, invoices or sales transactions might be used as the sampling unit.