Abstract The article presents the reply of the author to the comments by Mark Stephan, professor at Princeton University, published in the January 1960, issue of the journal "The Accounting review on his article "A Simplified Statistical Technique for Use in Verifying Accounts Receivable," which appeared in the October 1959 issue of the same journal. Stephan's main objection is that statistical correction factor used to reduce the sample size because the population is finite, or limited, should be incorporated into the original formula rather than solved separately. By not incorporating the factor with the basic part of the formula presented, the accountant could temporarily obtain a sample size larger than the total number of accounts, and this possibility was pointed out in several places in the original article. After completely solving the formula, the accountant must decide how he is to proceed to verify the selected accounts. The accountant's judgment as to the number actually reviewed is little more than conjecture.
Richard A. Ridilla (Fri,) studied this question.