Monetary Unit Sampling - Extended

The extended version of MUS works very similar to the basic version, just calculating the required trust via "Inherent risk rating", "Functional tests" and "Trust from analytical procedures".

To select the extended version, click on "Extended view" on the bottom of the MUS-window:

The required trust is calculated based on:

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• Inherent Risk Rating: Inherent risk refers to the susceptibility of an account or transaction to a material misstatement before considering internal controls. A higher inherent risk leads to a lower tolerance for errors, which increases the required confidence level.

• Functional Tests: Functional tests reduce the risk that an organization’s internal controls will not prevent or detect and correct a material misstatement. Control testing evaluates the effectiveness of these controls. Full functional tests (strong controls) reduce the needed confidence level, while no functional tests (weak controls) increase the required confidence level.

• Trust From Analytical Procedures: Trust from analytical procedures is based on the effectiveness of these procedures in identifying unusual or unexpected relationships that might indicate potential misstatements. Higher reliance on effective analytical procedures can reduce the necessary confidence level.

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These parameters impact the required trust (confidence level) the following way:

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• The higher the inherent risk rating, the higher the required confidence level.

• Greater reliance on analytical procedures (due to accurate and effective analytical reviews) and functional tests can decrease the required confidence level.