The outcome effect and professional skepticism: A replication and a failed attempt at mitigation

Joseph F. Brazel, Christine Gimbar, Eldar M. Maksymov, Tammie J. Schaefer

Research output: Contribution to journalArticle

1 Scopus citations

Abstract

In this research note, we replicate Brazel, Jackson, Schaefer, and Stewart’s (2016) study of how auditors evaluate skeptical behavior. Like the original study, we find that evaluators reward audit staff who exercise appropriate levels of skepticism and identify a misstatement (positive outcome). However, when no misstatement is identified (negative outcome), evaluators penalize staff who exercise appropriate levels of skepticism. One factor causing this outcome effect may be that exercising skepticism typically causes budget overages due to additional testing. Hence, we examine whether formally attributing the budget overage to skeptical judgments and actions in the audit budget file reduces outcome effects. However, while replicating the initial effect across three separate studies, we have been unable to reduce this effect. Thus, it is clear that the outcome effect in this context is very robust.

Original languageEnglish (US)
Pages (from-to)135-143
Number of pages9
JournalBehavioral Research in Accounting
Volume31
Issue number2
DOIs
StatePublished - Sep 1 2019
Externally publishedYes

Keywords

  • Audit
  • Budget
  • Evaluation
  • Outcome effect
  • Professional skepticism
  • Replication

ASJC Scopus subject areas

  • Accounting
  • Organizational Behavior and Human Resource Management

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