behavioral research in auditing 2011 aaa auditing doctoral consortium e. michael bamber j.m. tull...
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Behavioral Research in Auditing2011 AAA Auditing Doctoral Consortium
E. Michael BamberJ.M. Tull School of AccountingThe University of Georgia
Outline
Perspective: 1999 vs. 2010 Publishing BAuR Sources of Research Questions
Examples Issues
Publishing Trends - Numbers
1999 2010 % Increase
The Accounting Review
# of Papers 22 72 227
# of Auditing Papers 7 15 114
# of Behavioral Auditing Papers 3 7 133
Auditing: A Journal of Practice & Theory
# of Papers 17 25 47
# of Auditing Papers 17 25 47
# of Behavioral Auditing Papers 8 10 25
Publishing Trends - Numbers1999 2010 %
Increase
The Accounting Review
# of Papers 22 72 227
# of Auditing Papers 7 15 114
# of Behavioral Auditing Papers 3 7 133
Auditing: A Journal of Practice & Theory
# of Papers 17 25 47
# of Auditing Papers 17 25 47
# of Behavioral Auditing Papers 8 10 25
Consortium Participants 38 65 71
Publishing Trends - TopicsTitle Year Journal
The Audit Risk Model, Business Risk and Audit-Planning Decisions
The Audit Review Process and Sensitivity to Information Source Objectivity
The Influence of Documentation Specificity and Priming on Auditors’ Fraud Risk Assessments and Evidence Evaluation Decisions
A Field Experiment Comparing the Outcomes of Three Fraud Brainstorming Procedures
How do Audit Workpaper Reviewers Cope with the Conflicting Pressures of Detecting Misstatements and Balancing Client Workloads?
The Role of Problem Representation Shifts on Auditor Decision Processes
The Effects of Fee Pressure and Client Risk on Audit Seniors’ Time Budget Decisions
Joint Effects of Principles-Based versus Rules-Based Standards and Auditor Type in Constraining Financial Managers’ Aggressive Reporting
Publishing Trends - TopicsTitle Year Journal
The Audit Risk Model, Business Risk and Audit-Planning Decisions
1999 TAR
The Audit Review Process and Sensitivity to Information Source Objectivity
The Influence of Documentation Specificity and Priming on Auditors’ Fraud Risk Assessments and Evidence Evaluation Decisions
A Field Experiment Comparing the Outcomes of Three Fraud Brainstorming Procedures
How do Audit Workpaper Reviewers Cope with the Conflicting Pressures of Detecting Misstatements and Balancing Client Workloads?
The Role of Problem Representation Shifts on Auditor Decision Processes
The Effects of Fee Pressure and Client Risk on Audit Seniors’ Time Budget Decisions
Joint Effects of Principles-Based versus Rules-Based Standards and Auditor Type in Constraining Financial Managers’ Aggressive Reporting
Publishing Trends - TopicsTitle Year Journal
The Audit Risk Model, Business Risk and Audit-Planning Decisions
1999 TAR
The Audit Review Process and Sensitivity to Information Source Objectivity
1999 AJPT
The Influence of Documentation Specificity and Priming on Auditors’ Fraud Risk Assessments and Evidence Evaluation Decisions
A Field Experiment Comparing the Outcomes of Three Fraud Brainstorming Procedures
How do Audit Workpaper Reviewers Cope with the Conflicting Pressures of Detecting Misstatements and Balancing Client Workloads?
The Role of Problem Representation Shifts on Auditor Decision Processes
The Effects of Fee Pressure and Client Risk on Audit Seniors’ Time Budget Decisions
Joint Effects of Principles-Based versus Rules-Based Standards and Auditor Type in Constraining Financial Managers’ Aggressive Reporting
Publishing Trends - TopicsTitle Year Journal
The Audit Risk Model, Business Risk and Audit-Planning Decisions
1999 TAR
The Audit Review Process and Sensitivity to Information Source Objectivity
1999 AJPT
The Influence of Documentation Specificity and Priming on Auditors’ Fraud Risk Assessments and Evidence Evaluation Decisions
2010 TAR
A Field Experiment Comparing the Outcomes of Three Fraud Brainstorming Procedures
How do Audit Workpaper Reviewers Cope with the Conflicting Pressures of Detecting Misstatements and Balancing Client Workloads?
The Role of Problem Representation Shifts on Auditor Decision Processes
The Effects of Fee Pressure and Client Risk on Audit Seniors’ Time Budget Decisions
Joint Effects of Principles-Based versus Rules-Based Standards and Auditor Type in Constraining Financial Managers’ Aggressive Reporting
Publishing Trends - TopicsTitle Year Journal
The Audit Risk Model, Business Risk and Audit-Planning Decisions
1999 TAR
The Audit Review Process and Sensitivity to Information Source Objectivity
1999 AJPT
The Influence of Documentation Specificity and Priming on Auditors’ Fraud Risk Assessments and Evidence Evaluation Decisions
2010 TAR
A Field Experiment Comparing the Outcomes of Three Fraud Brainstorming Procedures
2010 TAR
How do Audit Workpaper Reviewers Cope with the Conflicting Pressures of Detecting Misstatements and Balancing Client Workloads?
The Role of Problem Representation Shifts on Auditor Decision Processes
The Effects of Fee Pressure and Client Risk on Audit Seniors’ Time Budget Decisions
Joint Effects of Principles-Based versus Rules-Based Standards and Auditor Type in Constraining Financial Managers’ Aggressive Reporting
Publishing Trends - TopicsTitle Year Journal
The Audit Risk Model, Business Risk and Audit-Planning Decisions
1999 TAR
The Audit Review Process and Sensitivity to Information Source Objectivity
1999 AJPT
The Influence of Documentation Specificity and Priming on Auditors’ Fraud Risk Assessments and Evidence Evaluation Decisions
2010 TAR
A Field Experiment Comparing the Outcomes of Three Fraud Brainstorming Procedures
2010 TAR
How do Audit Workpaper Reviewers Cope with the Conflicting Pressures of Detecting Misstatements and Balancing Client Workloads?
2010 AJPT
The Role of Problem Representation Shifts on Auditor Decision Processes
The Effects of Fee Pressure and Client Risk on Audit Seniors’ Time Budget Decisions
Joint Effects of Principles-Based versus Rules-Based Standards and Auditor Type in Constraining Financial Managers’ Aggressive Reporting
Publishing Trends - TopicsTitle Year Journal
The Audit Risk Model, Business Risk and Audit-Planning Decisions
1999 TAR
The Audit Review Process and Sensitivity to Information Source Objectivity
1999 AJPT
The Influence of Documentation Specificity and Priming on Auditors’ Fraud Risk Assessments and Evidence Evaluation Decisions
2010 TAR
A Field Experiment Comparing the Outcomes of Three Fraud Brainstorming Procedures
2010 TAR
How do Audit Workpaper Reviewers Cope with the Conflicting Pressures of Detecting Misstatements and Balancing Client Workloads?
2010 AJPT
The Role of Problem Representation Shifts on Auditor Decision Processes
1999 AJPT
The Effects of Fee Pressure and Client Risk on Audit Seniors’ Time Budget Decisions
1999 AJPT
Joint Effects of Principles-Based versus Rules-Based Standards and Auditor Type in Constraining Financial Managers’ Aggressive Reporting
2010 TAR
A Publishable Paper Provides Insights That Are:
New – Cause belief revision Interesting – Belief revision is
consequential True Clear
Deciding on a Topic
Prior literatureInnovations in practicePsychology theory
Prior Literature
Critically evaluate prior research (Sources: SSRN, Web of Science, AAA and conference websites)
What is the question? What is the research method? What is the punchline? Critique. What would we still like to know?
Prior Literature Build a framework
How do the prior papers fit together? Distill stylized facts: What do we think
we know? Identify research opportunities: What
would we like to know? Rely on others
Existing literature reviews and frameworks
Prior Literature - Examples Nelson, M. 2009. A model and literature
review of professional skepticism in auditing. Auditing: A Journal of Practice and Theory 28(2): 1-34. Framework for classifying failures in professional
skepticism (PS): More important antecedents? Definition of PS: Presumptive doubt?
Influence of traits and incentives? “Justifiable inefficiencies”
Incentives to avoid? Interventions to highlight and reward?
Prior Literature - Examples
Peecher, M.E., I. Solomon, and K.T. Trotman. 2010. Improving the quality of financial-statement audits by updating external auditors’ accountabilities. Working paper Focus less on penalties and more on rewards Propose 7 reforms, including
Refine the concept of professional skepticism Improve the content of the audit report Reward auditors who uncover fraud
Prior Literature - Examples
Hammersley, J.S. 2010. A Review and Model of Auditor Judgments in Fraud-Related Planning Tasks. Working Paper. Fraud knowledge obtained primarily from
training rather than experience Antecedents to effectively perform fraud
related tasks? Conditions under which auditors do/do not
respond to risk?
Innovations in Practice Carefully read and analyze the practice literature
(Sources: AICPA, PCAOB, SEC, Accounting firms) One-on-one communications
Distill state of practice: Where would the profession like to be?
Identify research opportunities: Improve practice? E.g., Carpenter, T. 2007. Audit team brainstorming, fraud
risk identification, and fraud risk assessment: Implications of SAS No. 99. The Accounting Review 82 (5): 1119-1140.
Messier, W.F., T.M. Kozloski, and N. Kochetova-Kozloski. 2010. An analysis of SEC and PCAOB enforcement actions against engagement quality reviewers. Auditing: A Journal of Practice & Theory 29(2): 232-252.
Innovations in Practice - Examples
PCAOB Standards New
AS No. 7 Engagement Quality Review Proposed
Concept Release on Requiring the Engagement Partner to Sign the Audit Report
Future The Auditors’ Reporting Model (2011
Agenda)
Innovations in Practice - Examples
PCAOB Inspection Reports Report on Observations of PCAOB Inspectors
Related to Audit Risk Areas Affected by the Economic Crisis (Sept. 2010) Fair value assumptions – failure to test beyond
inquiry of management Fair values – failure to reconcile inconsistencies
between management and third party estimates
Revenue recognition - failure to respond to specific risks, including risk of fraud
Psych Theory Coursework, esp. non-accounting Read the literature, esp. literature reviews
and seminal papers Citation searches for most recent work
Examples Wilks, T.J. 2002. Predecisional distortion of
evidence as a consequence of real-time audit review. The Accounting Review 77(1):51-72
Organizational Identity Theory, Small Group Theory, Social Identity Theory, Construal Level Theory
Developing the Topic
Goal: a publishable paper Consequential belief revision in
behavioral auditing will likely require integration of all three: Prior auditing literature – New – moving
literature forward Practice – Interesting – others care about
the topic Theory – New and Interesting – results
are generalizable/consequential
Issues Publishable topics?
Yes, more than ever (SOX, PCAOB standards agenda & inspection reports)
Journal interest? Yes, in select journals (TAR, AJPT, CAR, AOS) Top tier
Participants? The big issue, cycles Local vs. national Students
Lynch, A.L., U.S. Murthy, and T.J. Engle. 2009. Fraud brainstorming using computer-mediated communication: The effects of brainstorming technique and facilitation. The Accounting Review 84 (4): 1209-1232