The sampling method in which the entire sample is considered to be irregular if a single error is found is discovery sampling. Discovery sampling is a type of statistical sampling that is used to test for the existence of at least one occurrence of a specific characteristic or condition in a population. Discovery sampling is often used when the auditor expects the characteristic or condition to be very rare or nonexistent, and when any occurrence would have a significant impact on the audit objective. For example, discovery sampling can be used to test for fraud, noncompliance, or material misstatement.
Discovery sampling works by setting a very low tolerable error rate (the maximum rate of occurrence of the characteristic or condition that the auditor is willing to accept) and a high confidence level (the degree of assurance that the auditor wants to obtain). The auditor then selects a sample from the population using a random or systematic method, and examines each item in the sample for the presence or absence of the characteristic or condition. If no error is found in the sample, the auditor can conclude with a high level of confidence that the characteristic or condition does not exist or is very rare in the population. However, if one or more errors are found in the sample, the auditor cannot draw any conclusion about the population and must either expand the sample size or perform alternative procedures.
Discovery sampling differs from other sampling methods in that it does not allow for any errors in the sample.
Other sampling methods, such as variable sampling, stop-or-go sampling, or judgmental sampling, can tolerate some errors in the sample and use them to estimate the error rate or amount in the population. However, discovery sampling is designed to test for zero-tolerance situations, where any error would be unacceptable or material. Therefore, discovery sampling considers the entire sample to be irregular if a single error is found.
References:
* Audit Sampling - Overview, Purpose, Importance, and Types1
* Audit Sampling - What Is It, Methods, Example, Advantage, Reason2
* ISA 530: Audit sampling | ICAEW3
* Audit Sampling - AICPA4

Section: The process of Auditing Information System

Section: Protection of Information Assets
Explanation:
End-user developed applications may not be subjected to an independent outside review by systems
analysts and frequently are not created in the context of a formal development methodology. These
applications may lack appropriate standards, controls, quality assurance procedures, and documentation. A
risk of end-user applications is that management may rely on them as much as traditional applications.
End-user computing (EUC) systems typically result in reduced application development and maintenance
costs, and a reduced development cycle time. EUC systems normally increase flexibility and
responsiveness to management's information requests.

The best recommendation for an organization that does not have a process to identify and correct records that do not get transferred to the receiving system is to implement software to perform automatic reconciliations of data between systems. This will ensure that the data integrity and completeness are maintained and that any errors or discrepancies are detected and resolved in a timely manner. Enabling encryption, decryption, and electronic signing of data files may enhance the data security and authenticity, but not the data accuracy or consistency. Having coders perform manual reconciliation of data between systems may be prone to human errors and inefficiencies. Automating the transfer of data between systems as much as feasible may reduce the chances of data loss or corruption, but not eliminate them completely. References: IS Audit and Assurance Standards, section "Standard 1202: Risk Assessment in Planning"