Professional Skepticism and Auditor Judgment: Does Trait Skepticism Mitigate the Recency Bias?

Christopher Koch (), Annette Koehler () and Kristina Yankova ()
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Annette Koehler: University of Duisburg-Essen
Kristina Yankova: University of Duisburg-Essen

No 1623, Working Papers from Gutenberg School of Management and Economics, Johannes Gutenberg-Universität Mainz

Abstract: In two experiments with experienced auditors, we examine whether and how trait skepticism mitigates the tendency to place a greater emphasis on the most recently presented information, the so-called recency bias. We measure trait skepticism using the Hurtt scale (Hurtt 2010), manipulate information order, and vary presentation mode across two experiments. When information is presented sequentially (experiment 1), we find that auditors who score higher on the subconstructs of trait skepticism related to evidence examination are less likely to overweight contrasting evidence and thus are less prone to the recency bias. When information is presented simultaneously and the task is complex (experiment 2), we observe that auditors with higher trait skepticism exhibit higher cognitive effort which mitigates the recency bias. Our main contribution is the identification and detailed investigation of trait skepticism as a factor mitigating the recency bias, thereby providing evidence for its behavioral manifestation.

Keywords: Professional skepticism; trait skepticism; auditor judgment; recency (search for similar items in EconPapers)
Pages: 41 pages
Date: 2016, Revised 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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https://download.uni-mainz.de/RePEc/pdf/Discussion_Paper_1623.pdf First version, 2016 (application/pdf)

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