Audit Sampling

What is Audit Sampling?

Audit sampling is a technique used by auditors to examine a subset of data or transactions from a larger population to draw conclusions about the entire group. Instead of reviewing every single record, auditors apply statistical or judgment-based sampling methods to gain reasonable assurance about the effectiveness of controls, accuracy of financial records, or compliance with regulations.

Audit sampling balances efficiency with audit quality—enabling a reliable review without exhaustive, time-consuming testing.

Why Audit Sampling is Important

Audit sampling is critical for:

  • Efficient resource use—reviewing a representative portion instead of entire populations

  • Maintaining audit scope within time and budget constraints

  • Supporting evidence-based conclusions about control performance or compliance status

  • Reducing audit fatigue while ensuring statistical confidence

  • Meeting audit standards (e.g., those outlined by the Institute of Internal Auditors or PCAOB)

Used properly, audit sampling enhances audit integrity and risk-based decision-making.

Types of Audit Sampling

There are two primary categories:

1. Statistical Sampling

Uses mathematical formulas and probability to select samples and evaluate results. It allows auditors to quantify sampling risk.

Common methods include:

  • Random Sampling: Equal chance for each item to be selected

  • Systematic Sampling: Selection at regular intervals from a list

  • Stratified Sampling: Dividing the population into subgroups based on characteristics (e.g., high-value vs. low-value transactions)

2. Non-Statistical (Judgmental) Sampling

Relies on the auditor’s professional judgment rather than probability. While less quantifiable, it’s widely used for:

  • Targeting high-risk transactions

  • Selecting samples based on size, nature, or anomalies

  • Exploratory audits or investigations

Audit Sampling Process

  1. Define the Audit Objective
    What are you testing? (e.g., compliance with a policy, accuracy of billing)

  2. Identify the Population
    The full set of data from which the sample will be drawn.

  3. Determine Sample Size and Method
    Based on risk level, materiality, and audit goals.

  4. Select Sample Items
    Using statistical tools or auditor judgment.

  5. Perform Audit Procedures
    Test each item for compliance, accuracy, or control effectiveness.

  6. Evaluate Results and Extrapolate
    Decide whether findings suggest broader issues in the population.

Audit Sampling in GRC Programs

In the context of Governance, Risk, and Compliance (GRC), audit sampling supports:

  • Internal audit efficiency and effectiveness

  • Risk-based auditing strategies

  • Compliance verification without overburdening resources

  • Evidence gathering for audits of financial statements, operational controls, or regulatory adherence

Modern GRC platforms can integrate sampling methodologies directly into audit workflows, ensuring consistency, documentation, and audit trail generation.

Best Practices for Audit Sampling

  • Clearly document objectives, criteria, population, and rationale for sampling

  • Use data analytics to improve sample quality

  • Be aware of sampling risk—the chance that the sample does not reflect the whole population

  • Communicate findings with context—especially when projecting sample results

  • Ensure review and validation of sampling strategy by senior auditors or compliance officers

Audit sampling is a powerful tool for auditors and compliance professionals to assess large volumes of data without exhaustive testing. It enables data-driven, risk-informed conclusions that uphold audit standards and support internal control assurance. When integrated into a GRC framework, audit sampling helps organizations maintain regulatory readiness, operational oversight, and decision-making transparency