Work

Inferring About the Average Value of Audit Errors from Sequential Ratio Tests

Year: 2024

Type: article

Abstract: The book amounts are modeled as values of a random variable, represented by a mixture of distributions of both the correct and error-contaminated amounts. The mixing coefficient represents the proportion of items with non-zero error amounts. This study addresses the problem of determining the sample size needed for testing statistical hypotheses regarding mean accounting errors. The average sample size is estimated using the Sequential Probability Ratio Test (SPRT), applying the Monte Carlo method. Estimating average audit errors is a common challenge in economic research.

Source: Entropy

DOI: 10.3390/e26110998

Authors: Grzegorz Sitek, Mariusz Pleszczyński

Institutions: University of Economics in Katowice, Silesian University of Technology

Language: English

Topic: Auditing, Earnings Management, Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: gold

Estimated APC paid: $2,955

OpenAlex ID: W4404568441

FWCI: 4.043

Cites: 7

Cited by: 4

Related to: 10