Auditors' internal control opinions: do they influence judgments about investments?

Arnold Schneider

Managerial Auditing Journal, 2009, vol. 24, issue 8, 709-723

Abstract: Purpose - The purpose of this paper is to examine the impact of internal control opinions on individuals' judgments about investments. Design/methodology/approach - The approach used is a behavioral experiment where risk assessments and judgments about investments are made for four internal control opinion scenarios. Findings - The results indicate that the type of internal control opinion made no difference for either risk assessments or investment decisions. Research limitations/implications - Participants are provided with data sets that do not contain all of the information they may acquire when they make actual investment decisions. Also, there is a lack of real consequences for making good or poor investment decisions. Practical implications - The type of internal control opinion has no effect on risk assessments or investing intentions. Thus, other considerations apparently dominate internal control opinions when making judgments about investments. Originality/value - This is the first paper to examine whether intentions to invest might be affected by internal control opinions.

Keywords: Internal control; Auditing; Investments (search for similar items in EconPapers)
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:eme:majpps:02686900910986376

DOI: 10.1108/02686900910986376

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