This paper examines the initial planning processes of auditors, a research topic which has received very limited attention to date. In this empirical study auditors were given the results of analytical tests and asked to assess the likelihood that observed "abnormalities" were due to accounting error or irregularity as distinct from environmental change (i.e., an initial hypothesis). They were further asked to indicate the information they would seek in response to the test results, in an effort to resolve the issue adequately to proceed with planning the audit. The authors posit that: (1) for relatively inexperienced auditors, their initial hypothesis of cause will positively correlate with the type of information the auditors will subsequently seek (i.e., they will follow a hypothesis confirming strategy); and (2) for relatively experienced auditors, their initial hypothesis of cause will not correlate with the type of information sought but rather they will follow a balanced information search strategy. Support for this hypothesis was found using a rank measure of information seeking. A second measure of information seeking based on unranked questions, did not support the hypothesis, however.
ASJC Scopus subject areas
- Sociology and Political Science
- Organizational Behavior and Human Resource Management
- Information Systems and Management