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Re: Dollar Unit - Assumptions

From: Stan Hilliard
Date: 09 Apr 2000
Time: 00:50:39

Comments

You said:

> Are all the factors in the equation > based on assumptions > that are determined by the auditor?

In Dollar Unit sampling, each dollar is considered defective or not, depending on whether the document total is correct. The individual dollars that must be selected randomly or with constant interval. The percentage of dollars in-error in the sample is multiplied by the population of total dollars to determine the total dollars in-error (N*pbar). The margin of error for this estimate is z*N*Sqrt((pbar*(1-pbar))/n).

Nomenclature: z=normal deviate, N=population total dollars, pbar=fraction defective, n=sample size (dollars).

Stan Hilliard


Last changed: November 20, 2007