importance of statistics in accountancy and auditing?
Answers
Answer:
Accountants who perform audits benefit greatly from understanding and using statistical analysis. For example, when conducting a reliability assessment, one of the accountant’s first tasks is to gather evidence. Auditors know that the easiest way to do this is by looking at a portion of the whole, rather than gathering every bit of data available. Statistically representative samples are preferred in this area as they help auditors work more efficiently and objectively
Answer:
IMPOETANCE OF STATISCS IN ACCOUNTING:-
Accountants use statistics to forecast consumption, earnings, cash flow and book value. Simply put as accounting for the future, forecasting involves an amount of guesswork about the future – and when people guess, they frequently make errors.
IMPORTANCE OF STATISTICS IN AUDITING:-
Statistical techniques have been applied to at least three areas of relevance to auditing. These are: (1) control of clerical accuracy; ... For example, the auditor may sample payroll records in order to determine the extent of inac- curacies in the past year's vouchers.
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