FACTORS TO CONSIDER BEFORE ADOPTING STATISTICAL TECHNIQUE.
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Number of clients to whom it is appropriate as set up and training costs are high.
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Large populations must exist, as statistics is the science of large numbers.
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Adequate controls must exist where there are no controls it is impossible to use statistical techniques.
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Population being tested must be homogenous in materiality. Some system of control must exist in each of them.
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Too many variables cannot be tested at once.
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Items must be separately identifiable therefore sequential numbering is essential.
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Expectation of error must be low, i.e. that the internal control system must be reliable.
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Risk factor; the level of risk allowable and the degree of risk attached to the item being tested.