Sampling
Candlefocus EditorIn the marketing arena, sampling is used to gain insight into customer preferences, needs and wants. This is often done through surveys and focus groups, where the company attaches incentives to attract participation from its target market. Additionally, companies may use data from online reviews and ratings to understand how customers feel about the service or product; this approach gives companies the opportunity to track customer feedback in real-time, allowing for quicker decision-making when it comes to making changes to the product.
In terms of accounting and auditing, CPAs utilize different types of sampling techniques. These techniques include random sampling, block sampling, judgement sampling, and systemic sampling.
Random sampling occurs when CPAs use a list of entities, accounts, or transactions and then randomly select a portion of the element to be examined. This type of sampling eliminates the bias that is likely to occur when using judgement sampling.
Block sampling is typically used when the sample size is small or the CPA is limited in the amount of time to formulate an opinion on the financial information being tested. Instead of randomly selecting random amounts of data, CPAs use a ‘block’ of data in order to ensure that nothing is missed.
Judgement sampling occurs when the CPA uses his or her judgement when selecting data to be examined. CPAs are humans and there is the potential for bias when selecting data with this sampling technique.
Finally, systematic sampling is used with a predetermined starting point and a specific interval for each sample unit. This type of sampling is used when the CPA wants to examine multiple subgroups or different portions of an entity.
In conclusion, sampling is used across a variety of fields, from accounting and auditing, to marketing and data analysis. Sampling enables CPAs and companies to verify accuracy and completeness of account balances, complete surveys and focus groups, and observe customer feedback in real-time. Sampling is a powerful tool that can be used to make informed decisions that lead to the success of a business or audit.