Exploration of skepticism, client‐specific experiences, and audit judgments

Exploration of skepticism, client‐specific experiences, and audit judgments Purpose – The purpose of this paper is to examine how levels of trait professional skepticism (i.e. professional skepticism based on personal traits) and different experiences with a specific hypothetical client (i.e. positive, negative, or none) affect audit judgments. Design/methodology/approach – The paper is based on an experiment with auditing students, with one manipulated variable and one measured variable. Findings – The results show that initial expectations are driven primarily by client experience except when none is present (then driven by trait), but the experience has greater influence on low trait skeptics. Participants who are more skeptical are more sensitive to fraud evidence at the evidence evaluation stage. Research limitations/implications – The study uses student participants which reduces generalizability of the results to other populations. However, students are advantageous participants for examining pure trait skepticism unaffected by audit experience. Originality/value – The paper examines audit judgments at multiple stages of the audit decision‐making process to determine the impact on each stage. The results of this paper support concerns that audit quality is affected both by trait professional skepticism and prior client‐specific experiences. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Managerial Auditing Journal Emerald Publishing

Exploration of skepticism, client‐specific experiences, and audit judgments

Managerial Auditing Journal, Volume 28 (2): 21 – Dec 28, 2012

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Publisher
Emerald Publishing
Copyright
Copyright © 2013 Emerald Group Publishing Limited. All rights reserved.
ISSN
0268-6902
DOI
10.1108/02686901311284540
Publisher site
See Article on Publisher Site

Abstract

Purpose – The purpose of this paper is to examine how levels of trait professional skepticism (i.e. professional skepticism based on personal traits) and different experiences with a specific hypothetical client (i.e. positive, negative, or none) affect audit judgments. Design/methodology/approach – The paper is based on an experiment with auditing students, with one manipulated variable and one measured variable. Findings – The results show that initial expectations are driven primarily by client experience except when none is present (then driven by trait), but the experience has greater influence on low trait skeptics. Participants who are more skeptical are more sensitive to fraud evidence at the evidence evaluation stage. Research limitations/implications – The study uses student participants which reduces generalizability of the results to other populations. However, students are advantageous participants for examining pure trait skepticism unaffected by audit experience. Originality/value – The paper examines audit judgments at multiple stages of the audit decision‐making process to determine the impact on each stage. The results of this paper support concerns that audit quality is affected both by trait professional skepticism and prior client‐specific experiences.

Journal

Managerial Auditing JournalEmerald Publishing

Published: Dec 28, 2012

Keywords: Auditing; Auditors; Personality; Individual behaviour; Skepticism; Client‐specific previous experience; Fraud; Audit judgments

References

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