SA 530 requires that when audit sampling is used, the sample is designed, selected and evaluated so that every sampling unit in the population has a chance of selection and the results can be projected to the whole population — a requirement that applies equally whether the method chosen is statistical or non-statistical. The standard does not require statistical sampling; it requires that whichever method is used, the auditor can reach a valid conclusion about the population from the items actually tested.
Statistical vs non-statistical — what SA 530 actually distinguishes
| Aspect | Statistical sampling | Non-statistical sampling |
|---|---|---|
| Selection | Random, using probability theory | Judgmental, based on auditor knowledge of the population |
| Evaluation | Quantifies sampling risk mathematically | Relies on auditor judgment to assess sampling risk qualitatively |
| When SA 530 favours it | Larger, more homogeneous populations where a defensible, reproducible result matters | Smaller or stratified populations where judgment about which items carry risk adds more value than randomisation |
Designing the sample — the required steps
- 01Define the population correctlyThe population must be appropriate to the specific audit objective — testing for understatement of payables from a population of recorded payables will not detect unrecorded ones; a different population (e.g. subsequent payments) is needed.
- 02Consider stratification or value-weighted selectionDividing a population into subpopulations with similar characteristics, or selecting in proportion to monetary value, increases the efficiency of the sample without abandoning the population-wide conclusion.
- 03Determine an appropriate sample sizeDriven by sampling risk the auditor is willing to accept, tolerable misstatement, and the expected misstatement in the population — not a fixed percentage applied regardless of risk.
- 04Select items so every unit has a chance of selectionRandom selection, systematic selection, or monetary unit sampling all satisfy this; convenience selection of whatever is easiest to pull does not.
Regulatory requirement
SA 530 requires projecting the misstatements found in the sample to the population, to get the best estimate of misstatement in the population as a whole, and comparing that projected misstatement to tolerable misstatement — the raw amount found in the sample, un-projected, is not the figure the standard requires you to evaluate.
Replacing a sample item that looks awkward to test — a missing invoice, an unusual vendor — with the next convenient item breaks the basis for projection. SA 530 requires investigating the nature and cause of items that can't be examined as originally selected, not substituting around them.
This is practical guidance written for audit teams, not an authoritative statement of any standard or statute. Standards, forms and timelines change. Check the current text issued by the ICAI and the relevant authority before relying on anything here in an audit file.
Related resources
- Audit workflow & automationAudit sampling methods for Indian CA firmsStatistical vs judgmental sampling, when full-population testing removes the need to sample, when sampling still applies, and what drives sample size.
- Audit workflow & automationSA 330: the auditor's responses to assessed risksA higher-risk item doesn't just need more testing. It needs more persuasive evidence — those are two different design decisions.
- Audit documentationSA 450: evaluating misstatements identified during the auditA misstatement that's immaterial on its own doesn't stay immaterial once it's added to the schedule. SA 450 requires the running total, not just the single-item test.
- Audit workflow & automationSA 315: identifying and assessing the risks of material misstatementA risk assessment that doesn't name a specific assertion isn't a risk assessment under SA 315 — it's a general impression written down.
Free tools, no signup
Each one reads a file entirely in your browser — or, for two of them, just answers a few questions — and nothing is ever uploaded.
- Purchase register checkDuplicate payments, round-sum amounts, weekend-dated invoices, incomplete records.
- GSTR-2B reconcilerMatches your purchase register against GSTR-2B — missing invoices either side, amount mismatches.
- Bank reconciliation checkerMatches your cash book against a bank statement — what's outstanding on each side.
- Fixed asset register checkDuplicate asset codes, missing location or useful life, negative net book value.
- Payroll red-flag scannerBank accounts shared across employees, and records missing an ID, PAN or salary.
- CARO applicability checkerAnswer a few questions about the company and see which CARO 2020 clauses likely apply.
- MSME payment delay checkerMSME-flagged invoices paid — or still unpaid — beyond the 45-day Section 22 limit.
- Related-party transaction screenerTransactions above a threshold you set with no approval reference, grouped by counterparty.
- Depreciation useful life checkerCompares a useful life in use against the Schedule II, Part C indicative figure.
- Materiality calculatorOverall and performance materiality against PBT, revenue, assets or equity, with reasoning shown.
- Sample size calculatorStatistical sample size for a test of controls or a substantive test of detail.