In order to improve auditor judgments, it is first necessary to understand and evaluate what successful auditors do differently than those who are less successful. This study uses a computerized research instrument to examine in a single experiment the hypothesis generation, information search, hypothesis evaluation, and final judgment stages of the analytical procedures process. The inclusion of a criterion variable and the ability to search for additional evidence allows the study to examine in which of the various stages of analytical procedures auditors make less‐than‐optimal judgments. Of the 82 participants, 24 selected the correct cause, 19 never generated the correct cause as a hypothesis, and 39 generated the correct cause as a hypothesis but ended up not selecting it. The incorrect participants were divided into two categories: those who incorrectly selected the inherited hypothesis and those who incorrectly selected another self‐generated non‐error as the cause. The former group showed deficiencies in both information search and hypothesis evaluation compared to the correct group. The second incorrect group had similar information search patterns to the correct participants but had inferior hypothesis evaluation. These findings therefore lend support to the suggestion by Asare and Wright (2003) that not only is hypothesis generation important, but also information search and hypothesis evaluation are important.
An Examination of Different Performance Outcomes in an Analytical Procedures Task
Wendy J. Green, Ken T. Trotman; An Examination of Different Performance Outcomes in an Analytical Procedures Task. AUDITING: A Journal of Practice & Theory 1 September 2003; 22 (2): 219–235. https://doi.org/10.2308/aud.2003.22.2.219
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