Explicitly stated client preferences are intended to persuade the auditor to accept a preferred outcome. This experimental study investigates two determinants of a preference's persuasiveness—timing and client credibility. Sixty‐four experienced auditors completed two hypothetical cases, one involving disclosure of a contingent liability and the other involving the collectibility of a customer account. The findings suggest that audit judgments regarding contingent liability disclosure may be biased toward a client's preference if the preference is received prior to evidence evaluation (i.e., an early preference) but not if the preference is received at the end of the evidence evaluation process (i.e., a late preference). No such bias, however, is present for the collectibility judgment. Results also indicate that auditors who receive an early preference ask to examine more additional audit evidence than those who receive a late preference, although whether they seek additional evidence to confirm or disconfirm the client's preference remains unclear. Finally, no support is found for the ordinal interaction hypothesizing that only a highly credible client in the early preference condition will differentially influence contingent liability disclosure and accounts receivable collectibility judgments.
The Persuasiveness of Client Preferences: An Investigation of the Impact of Preference Timing and Client Credibility
J. Gregory Jenkins, Christine M. Haynes; The Persuasiveness of Client Preferences: An Investigation of the Impact of Preference Timing and Client Credibility. AUDITING: A Journal of Practice & Theory 1 March 2003; 22 (1): 143–154. https://doi.org/10.2308/aud.2003.22.1.143
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