Difference Estimation (Variables Sampling)

To calculate the implied audit value for a population using difference estimation:

1. Calculate the difference between the audit value and book value for the sample

2. Divide the difference (from Step 1) by the number of accounts int he sample to get the average difference from the sample

3. Multiply the average difference (from Step 2) by the number of accounts in the population

4. Add the amount calculated in Step 3 to the book value for the population. The resulting figure is the implied audit value for the population—
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