Statistical sampling enables the examiner to predict the occurrence rate for the population and therefore determine with some accuracy the error rate, or the potential for fraud.
Rationale for Correct Answer:This statement is True. Statistical sampling allows fraud examiners to make inferences about an entire population based on a representative sample. By calculating occurrence rates, they can estimate error rates and assess the likelihood of fraud in the larger dataset.
Analysis of Incorrect Options:
B. False – Incorrect because statistical sampling is explicitly designed to estimate population-level characteristics.
Key Concept:Sampling in fraud examination — predicting occurrence and error rates.
Chosen Answer:
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