The effects of decision-aid use and reliability on jurors' evaluations of auditor liability

Research output: Contribution to journalReview article

57 Scopus citations

Abstract

This study provides evidence on how auditors' use of decision aids affects jurors' evaluation of auditor legal liability, based on an experiment in which actual jurors responded to a hypothetical audit lawsuit. The results suggest that decision aids can have positive, negative, or neutral effects on auditors' legal liability, depending on how auditors use the decision aid and the reliability of the decision aid. For high-reliability aids, jurors attributed more responsibility for an audit failure to the auditor when the auditor overrode the recommendation of a decision aid than when the auditor did not use the decision aid. However, jurors attributed lower responsibility to an auditor who relied on the recommendation of a highly reliable decision aid, even though the aid turned out to be incorrect. In contrast to the high-reliability conditions, auditors' use of the decision aid had virtually no impact on jurors' liability judgments when the reliability of the decision aid was low.

Original languageEnglish (US)
Pages (from-to)185-202
Number of pages18
JournalAccounting Review
Volume77
Issue number1
DOIs
StatePublished - Jan 2002
Externally publishedYes

Keywords

  • Auditor liability
  • Decision aids
  • Fraud detection

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics

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