ABSTRACT
This paper reports the results of an experiment examining whether estimate source (developed by an external consultant or the audit client) interacts with social pressure (obedience pressure from a superior or conformity pressure from a peer) to influence Chinese auditors' judgments of fair value estimates. The results reveal an interaction between the source of the estimate and the type of social pressure. Specifically, Chinese auditors' risk assessments and judgments regarding whether an auditor will investigate further are not influenced by relevant information about a fair value estimate's source when advised to use a questionable estimate by a superior. However, when the same advice is received from a peer, the likelihood of further investigation and auditors' risk assessments are impacted by the estimate's source.
