Breaking the Mold: An Experimental Study of Auditor Procedure Modification By: Paige Harrell Restricted; Files Only

Abstract

Auditors often rely on prior year plans, procedures, and conclusions when designing the audit procedures for the current year. This practice is problematic when auditors need to make changes to audit procedures. I draw from organizational behavior literature on taking charge to investigate conditions under which lower-level auditors are more or less likely to modify audit procedures. Using an experiment, I show that team climates that are more supportive of change cause staff-level auditors to be more willing to modify procedures to incorporate new information, and this environmental factor is more influential when staff-level auditors have perceptions of higher role-breadth self-efficacy. The results of this study improve our understanding of how team climates and auditors’ perceptions of their own abilities jointly influence their judgments and decisions and inform audit firms about how to promote change within their audit processes.

Table of Contents

DISSERTATION

Introduction

1

Background and Hypothesis Development

5

Method

14

Results

19

Discussion and Conclusion

25

References

28

 

FIGURES

Figure 1: Overview of experimental procedures

32

Figure 2: Illustration of predicted effect

33

Figure 3: Observed effect on auditor reported likelihood of modifying the audit procedure

34

Figure 4: Observed effect on auditor choice to modify the audit procedure

35

 

TABLES

Table 1: Likelihood of Modifying the Audit Procedure by Incorporating Non-Financial

        Information

32

Table 2: Choice of Modifying the Audit Procedure or Using Prior Year Method

33

 

 

About this Dissertation

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School	Laney Graduate School
Department	Business
Subfield / Discipline	Accounting
Degree	Ph.D.
Submission	Dissertation
Language	English
Research Field	Business Administration, Accounting
Keyword	prior-year workpapers team climate auditors learning audit procedures self-efficacy
Committee Chair / Thesis Advisor	Kathryn Kadous, Emory University
Committee Members	Jill Perry-Smith, Emory University Cassandra Estep, Emory University Jacqueline Hammersley, University of Georgia

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