 In this presentation, we will take a look at non-statistical sampling for tests of account balances. Note that we took a look at non-statistical sampling in a prior presentation with relation to tests of controls. Here, we're applying non-statistical sampling for account balances. So you will see some similarities within the application of the non-statistical sampling. Sampling unit for non-statistical sampling is generally a customer account, an individual transaction, or a line item on a transaction. The following items must be considered when we're thinking about non-statistical sampling. Identify individually significant items. So we're going to consider those items that are individually significant. We'll talk more about that shortly. Determining the sample size, selecting sample items, and calculating the sample results. We'll add some of these items in more detail now, starting with identifying individually significant items. Items to be tested individually are items that may have a potential misstatement that individually exceeds the tolerable misstatement. So let's read that one more time. Items to be tested individually are items that may have the potential misstatements that individually in and of themselves, in other words, exceeds the tolerable misstatement. So if we look through the data and we have these types of areas that the misstatement themselves for that individual item could exceed the tolerable misstatement, we want to pick those items out. These items will be tested 100% because the auditor is not willing to accept any sampling risk with regards to these items given their nature. As significant items, determining the sample size and selecting the sample. So how do we determine what the sample size is? This is going to be our formula sample size will be equal to the sampling population in the book value. So the book value population, then we have the tolerable minus the expected misstatement. So tolerable misstatement minus the expected misstatement will be divided into the sampling population book value or sampling population book value divided by tolerable misstatement minus expected misstatement times a confidence factor. Now this confidence factor might be given in basically our audit papers. We might have some standardized kind of factors that we would use something like a table such as this where the assessed risk of the material misstatement is here and then the desired level