An Examination of Auditors' Reporting Intentions When Another Auditor Is Offered Client Employment

2001 ◽  
Vol 20 (1) ◽  
pp. 45-63 ◽  
Author(s):  
Steven E. Kaplan ◽  
Stacey M. Whitecotton
Keyword(s):  
Personal Responsibility ◽  
Financial Statement ◽  
Accounting Profession ◽  
Personal Costs ◽  
Reporting Intentions

An AICPA ethics ruling prohibits auditors from considering employment with a client during the audit engagement in order to minimize the concerns that financial statement users may have regarding the auditor's independence, in fact or appearance. The objective of this study is to examine auditors' reporting intentions when it is discovered that another auditor is considering employment with the client and has failed to comply with the ethics ruling. We test a model that predicts that auditors' reporting intentions will be influenced by their perceptions of the seriousness of the act, the personal costs of reporting, their responsibility for reporting, and their commitment to the accounting profession. The results indicate that auditors' reporting intentions are stronger when personal costs of reporting are perceived to be lower or personal responsibility for reporting is perceived to be higher. Implications of the findings for audit practice are discussed.

Auditors' and Investors' Perceptions of the “Expectation Gap”

2001 ◽  
Vol 15 (4) ◽  
pp. 345-358 ◽  
Author(s):  
John E. McEnroe ◽  
Stanley C. Martens
Keyword(s):  
Empirical Studies ◽  
Primary User ◽  
Financial Statement ◽  
User Group ◽  
Accounting Profession ◽  
The Public ◽  
Government Accounting ◽  
Expectation Gap ◽  
The Difference

The auditing “expectation gap” refers to the difference between (1) what the public and other financial statement users perceive auditors' responsibilities to be and (2) what auditors believe their responsibilities entail. The notion of this divergence receives much attention in the accounting literature (i.e., Commission on Auditors' Responsibilities 1978; Guy and Sullivan 1988; AICPA 1993; U.S. Government Accounting Office 1996). Although prior empirical studies encompass certain expectations associated with a range of audit services, these papers often involve the opinions of bankers as the primary user group employed in the research (Nair and Rittenberg 1987; Lowe and Pany 1995). In contrast, this study extends the prior research by directly comparing audit partners' and investors' perceptions of auditors' responsibilities involving various dimensions of the attest function. We conducted the study to determine if an expectation gap currently exists and we find that it does; investors have higher expectations for various facets and/or assurances of the audit than do auditors. Our findings serve as evidence that the accounting profession should engage in appropriate measures to reduce this expectation gap.

Perceptions, predictors and consequences of whistleblowing among accounting employees in Barbados

2017 ◽  
Vol 25 (2) ◽  
pp. 241-267 ◽  
Author(s):  
Philmore Alleyne ◽  
Wayne Charles-Soverall ◽  
Tracey Broome ◽  
Amanda Pierce
Keyword(s):  
Organizational Support ◽  
Personal Responsibility ◽  
Codes Of Conduct ◽  
Future Research ◽  
Cultural Norms ◽  
Content Type ◽  
Face To Face ◽  
Qualitative Approaches ◽  
Personal Costs ◽  
Internal Whistleblowing

Purpose Whistleblowing has been receiving increased attention and support in recent times as a means of detecting and correcting wrongdoing in organizations. This study aims to examine perceptions, attitudes and consequences (actions and reactions) of whistleblowing, as well as the predictors of internal and external whistleblowing intentions, by using Graham’s (1986) model of principled organizational dissent in a small emerging and collectivist culture like Barbados. Design/methodology/approach The study utilized a self-administered survey of 282 accounting employees working in organizations in Barbados. Findings Results reveal that there is little awareness of whistleblowing legislation. Most respondents perceive whistleblowing as ethical and favor internal over external whistleblowing. Findings show that personal responsibility and personal costs significantly influence internal whistleblowing intentions, while personal costs influence external whistleblowing. Using qualitative data, several themes emerged as influencing whistleblowing: perceived benefits of whistleblowing, actual whistleblowing experiences (handling of reports), personal costs (climate of fear and hostility), perceived lack of anonymity and cultural norms. Research limitations/implications Future research should control for social desirability bias and use more rigorous qualitative approaches such as face-to-face interviews and focus groups to gain in-depth opinions and feelings on the topic. Practical implications Whistleblowing can be achieved through such mechanisms as perceived organizational support, strong ethical codes of conduct, rewarding ethical behavior and promoting sound work ethics in organizations. Originality/value This paper explores whistleblowing in an emerging economy where there has been little research on the topic. Thus, this study supplements the existing research in emerging economies by examining the applicability of Graham’s (1986) model of principled organizational dissent.

scholarly journals Which is a Better Method for Reporting Cash Flows from Operating Activities-Direct or Indirect Method?

2020 ◽  
pp. 19-28
Author(s):  
Dumisani Rumbidzai Muzira
Keyword(s):  
Indirect Method ◽  
Direct Method ◽  
Cash Flows ◽  
Financial Statement ◽  
Accounting Profession ◽  
Ongoing Debate ◽  
Argument Map ◽  
Qualitative Argument ◽  
Better Than ◽  
Operating Activities

This paper is a response to the ongoing debate in the accounting profession on whether the direct method is better than the indirect method when reporting cash flows from operating activities. The debate has its roots from the standard setters who prefer the direct method and are even debating on whether to make the direct method mandatory. The contention being that the direct method is a better method than the indirect method when reporting cash flows from operating activities since the disaggregation of its components suggests more disclosure. More disclosure in financial statements has been a cry from the financial statement users such as the creditors and investors. This qualitative argument will therefore show the merits of both the direct and the indirect               method before getting to a conclusion on which method is better than the other. Further, it is a contribution to the ongoing debate in the accounting profession that can guide the standard setters as they deliberate on the possibility of making the direct method mandatory. In addition, a contention map and an argument map are used as roadmaps of the ideas being discussed in this study.

Put Your Best Text Forward: Introducing Textual Analysis into the Accounting Classroom

2021 ◽  
Author(s):  
Ingrid Fisher ◽  
Mark Hughes ◽  
Diane J. Janvrin
Keyword(s):  
Information Systems ◽  
Data Analytics ◽  
Textual Analysis ◽  
Accounting Information ◽  
Digital Data ◽  
Financial Statement ◽  
Accounting Students ◽  
Accounting Profession ◽  
Financial Statement Analysis ◽  
Accounting Information Systems

The use of textual analysis methods in the accounting profession has grown markedly in recent years. Accounting professionals as well as business and accounting accreditors have called for accounting students to acquire an increased depth and breadth of knowledge of digital data analytics. This case enables accounting instructors, with no previous background or experience in textual analysis, to introduce students to the use of textual analysis in accounting and allows students to conduct simple analyses using freely available software and documents retrieved from publicly available SEC filings. This case is designed for auditing, accounting information systems, fraud examination, and financial statement analysis courses, but it can be used in any accounting course where the content of relevant documents is subject to examination.

A Historical Assessment of a Key Auditor Independence Policy: Auditing Your Own Work

2020 ◽  
Vol 47 (2) ◽  
pp. 11-20
Author(s):  
John D. Keyser
Keyword(s):  
Financial Statements ◽  
Auditor Independence ◽  
Securities And Exchange Commission ◽  
Financial Information ◽  
Financial Statement ◽  
Accounting Profession ◽  
The Subject

ABSTRACT In 1973, the AAA's Committee on Basic Auditing Concepts distinguished the respective roles of management and auditors (AAA 1973). Management is responsible to record, summarize, and communicate financial information to financial statement users. Auditors are responsible to communicate to users an opinion regarding the reliability of the financial information provided by management. The view of the Securities and Exchange Commission (SEC) regarding bookkeeping services, held since June 1940, is consistent with this division of responsibility. In contrast, the accounting profession took the position in 1949 that auditors can objectively audit financial statements with which they assisted in the preparation, and continues to hold that position to the present day. The evolution of these divergent positions regarding the respective roles of management and auditors is the subject of this paper.

Does Viewing Sacrificed Integrity as a Negotiable Cost Promote Acceptance of Fraud?

2017 ◽  
Vol 2 (1) ◽  
pp. A71-A90
Author(s):  
Joseph C. Ugrin ◽  
Marcus Dean Odom
Keyword(s):  
Self Regulation ◽  
Financial Statement ◽  
Financial Statement Fraud ◽  
Accounting Profession ◽  
Professional Integrity ◽  
Outcome Bias ◽  
The Relationship

ABSTRACT The accounting profession relies heavily on professional integrity to control fraud and abuse; yet we know little about the relationship between integrity and fraud. We propose that integrity influences accountants' attitudes about fraud through rational calculations of risk and reward, where accountants weigh the loss of integrity against potential returns. We adapt and test a model that incorporates outcome bias and framing in an experiment with student participants (n = 86). When confronted with financial statement fraud, the likely outcome of the fraud influences attitudes about integrity, and integrity mediates the effect of the likely outcome of the fraud on attitudes toward the fraud. This finding suggests that attitudes about integrity partially determine attitudes about fraud. However, we argue that accountants' attitudes about integrity are corruptible, meaning the profession cannot rely on self-regulation alone to control fraud and abuse.

scholarly journals An Empirical Evaluation Of Goodwill Accounting

2011 ◽  
Vol 9 (4) ◽  
pp. 127 ◽  
Author(s):  
Zhemin Wang
Keyword(s):  
Empirical Evaluation ◽  
Financial Statement ◽  
Accounting Profession ◽  
Regulatory Bodies

While the current amortization period for goodwill is criticized by many financial statement preparers for being too short, the accounting profession and regulatory bodies indicate the intention of further reducing the amortization period. This study documents consistent evidence suggesting that any attempt to significantly shorten the amortization period may impose an unfair penalty on firms with goodwill assets and cause the reported goodwill to be significantly understated.

Associations Between Dutch LGBT Hate Crime Experience, Well-Being, Trust in the Police and Future Hate Crime Reporting

2020 ◽  
Vol 51 (3) ◽  
pp. 171-182
Author(s):  
Allard R. Feddes ◽  
Kai J. Jonas
Keyword(s):  
Psychological Distress ◽  
The Netherlands ◽  
Hate Crime ◽  
Well Being ◽  
Crime Victims ◽  
Crime Reporting ◽  
Survey Study ◽  
Psychological Well Being ◽  
Building Trust ◽  
Reporting Intentions

Abstract. LGBT-related hate crime is a conscious act of aggression against an LGBT citizen. The present research investigates associations between hate crime, psychological well-being, trust in the police and intentions to report future experiences of hate crime. A survey study was conducted among 391 LGBT respondents in the Netherlands. Sixteen percent experienced hate crime in the 12 months prior. Compared to non-victims, victims had significant lower psychological well-being, lower trust in the police and lower intentions to report future hate crime. Hate crime experience and lower psychological well-being were associated with lower reporting intentions through lower trust in the police. Helping hate crime victims cope with psychological distress in combination with building trust in the police could positively influence future reporting.

My Culture Made Me Do It

2012 ◽  
Vol 43 (2) ◽  
pp. 108-113 ◽  
Author(s):  
Eric Luis Uhlmann ◽  
Brian A. Nosek
Keyword(s):  
Personal Responsibility ◽  
Cultural Socialization ◽  
Racial Biases

The present research examined the effects of egocentric motivations on individuals’ explanations for how their automatic racial prejudices came into being. The majority of participants reported experiencing biased thoughts, feelings, and gut reactions toward minorities which they found difficult to consciously control, and they attributed such biases to cultural socialization. Of particular interest, ego-threatened participants were significantly more likely to attribute their automatic racial biases to their culture and significantly less likely to attribute such biases to themselves. Results suggest that attributing one’s racial biases to cultural socialization can be a defensive, motivated process aimed at diminishing personal responsibility.

Personal Responsibility Therapy

1989 ◽  
Vol 34 (4) ◽  
pp. 399-400
Author(s):  
George S. Howard
Keyword(s):  
Personal Responsibility
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