Sampling Practices of Internal Auditors at Corporations on the Standard & Poor's Toronto Stock Exchange Composite Index

Michael Maingot and Tony K. Quon

Accounting Perspectives, 2009, vol. 8, issue 3, 215-234

Abstract: The purpose of this study is to find out how often statistical and nonstatistical audit sampling practices are used by internal auditors in companies listed on the Standard and Poor's (S&P) Toronto Stock Exchange (TSX) Composite Index and how such practices are related to the training and background of the respondents. We adapted the questionnaire used by Hall, Hunton, and Pierce (2002) in their survey of U.S. auditors in public accounting, industry, and government. Although 20 percent of companies responding do not have an internal audit department, the other 80 percent use statistical methods to plan sample sizes 15 percent (+5 percent) of the time, random sample selection methods 23 percent (+5 percent) of the time, but statistical evaluation methods only 10% (+4%) of the time. Despite the low percentage use, almost half of the respondents reported substantial training in statistical sampling and evaluation methods. Moreover, we found statistically significantly higher proportions of respondents with substantial training in audit sampling methods among companies cross‐listed on U.S. exchanges compared with companies listed only on the TSX. Finally, respondents with a chartered accountant designation tend to have a negative impact on the use of statistical methods in audit sampling, and companies cross‐listed on U.S. exchanges tend to have larger internal audit departments than companies listed only on the TSX.

Date: 2009
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https://doi.org/10.1506/ap.8.3.2

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Persistent link: https://EconPapers.repec.org/RePEc:wly:accper:v:8:y:2009:i:3:p:215-234

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