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Publication Date

1997

Abstract

The study suggests that the AICPA's efforts to investigate the use of statistical sampling appear to have been catalyzed by the confluence of the growing dissatisfaction with the traditional approach to sampling and the widespread recognition of the benefits of statistical sampling which were being realized in other professions and in industry. The fact that large corporations had begun to use statistical sampling in accounting and auditing lent additional urgency to the need to address the issue. In addition, some doubted the tenability of traditional sampling if challenged in court by a statistician. The study also examines the research efforts of the AICPA which include case studies, legal opinions, a review of the mathematical underpinning of statistical sampling, and the initiation of an interdisciplinary collaborative effort with the American Statistical Association. The research suggests that from the very beginning, the AICPA was most cognizant of the legal implications of statistical sampling and that the legal opinions obtained played a key role in the profession's eventual acceptance of this new technology. The study also indicates that the AICPA's research led it to reexamine basic auditing concepts and challenge existing standards. The national CPA firms shared information regarding their individual in-house experimentation with statistical sampling which suggests that a spirit of collegial cooperation existed rather than competition-related secrecy. Lastly, the research demonstrates the importance of individual leadership in the profession's efforts to adopt new technology; here, the study provides a glimpse of two Accounting Hall of Fame members, Robert M. Trueblood and Oscar Gellein, and the first recipient of the Distinguished Service in Auditing Award, Kenneth W. Stringer, making one of their many professional contributions. The study suggests that without the strong leadership provided by these three individuals, the profession's adoption of this technology would have taken significantly longer.

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