## Factors Influencing Sample Size in Tests of Details
Sample size in Tests of Details moves in a direct or inverse relationship with the following factors:
| Factor | Change | Effect on Sample Size |
|---|---|---|
| (a) Auditor's assessment of Risk of Material Misstatement (ROMM) | ↑ Increases | ↑ Increases |
| (b) Reliance on other substantive procedures (e.g., analytical procedures) | ↑ More reliance | ↓ Decreases |
| (c) Tolerable Misstatement | ↑ Increases | ↓ Decreases |
| (d) Desired level of assurance that tolerable misstatement is not exceeded | ↑ Higher assurance wanted | ↑ Increases |
| (e) Expected Misstatement (amount of misstatement auditor expects in population) | ↑ Greater expectation | ↑ Increases |
| (f) Stratification of population (when appropriate) | Reduces variability | ↓ Decreases |
| (g) Number of sampling units in population | ↑ or ↓ | Negligible effect |
| (h) Sampling unit is a monetary value | Yes | ↑ Increases |
### Key Insights
- ROMM and sample size: Higher risk → audit must be more rigorous → more items tested.
- Reliance on other procedures: If analytical procedures already provide comfort, fewer detailed tests are needed.
- Tolerable misstatement: A higher threshold means the auditor can afford to miss more → smaller sample.
- Expected misstatement: If you expect more errors, you need a bigger net to capture and project them accurately.
- Stratification: Grouping a heterogeneous population into homogeneous strata reduces internal variability, allowing a smaller total sample.
- Population size: Unlike common intuition, the absolute size of the population has a negligible effect on sample size — this is a key exam point.