This study examines the relation between consensus and accuracy using an error frequency estimation task for which auditors' overall accuracy is known to be low to moderate. We also investigate whether experience moderates the relation between consensus and accuracy for the three industries examined: manufacturing, natural resources, and banking. We find that accuracy is positively related to consensus for all auditors in manufacturing and for auditors with more than 12 (36) months of experience in natural resources (banking). For banking and natural resources, we provide evidence that auditors with little experience in these industries use a heuristic consistent with manufacturing error frequencies as an “educated guess” for the specialized industries' error frequencies. This heuristic leads to consensus among auditors, but results in low accuracy. The results are important for auditing practice and research since reliance on high consensus as a surrogate for accuracy may prove inefficient or, worse, ineffective. The results also demonstrate the need for further investigation of the determinants of audit knowledge and performance across multiple industries and tasks.
The Relation between Consensus and Accuracy in Low‐to‐Moderate Accuracy Tasks: An Auditing Example
Elizabeth B. Davis, S. Jane Kennedy, Laureen A. Maines; The Relation between Consensus and Accuracy in Low‐to‐Moderate Accuracy Tasks: An Auditing Example. AUDITING: A Journal of Practice & Theory 1 March 2000; 19 (1): 101–121. https://doi.org/10.2308/aud.2000.19.1.101
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