Experimental evidence of how prior experience as an auditor influences managers' strategic reporting decisions

• 成果类型: Article
• 署名作者: Bowlin, Kendall O.; Hales, Jeffrey; Kachelmeier, Steven J.
• 署名单位: University of Texas System; University of Texas Austin; University of Mississippi; University System of Georgia; Georgia Institute of Technology
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-008-9077-0
• 发表日期: 2009
• 页码: 63-87
• 关键词: risk; dependence; BIAS; game

摘要

We design an experiment to examine the influence of audit experience on subsequent reporting decisions when auditors become managers of audited firms. In contrast to the independence issues that can arise when auditors and their clients are related by prior affiliation, we focus this study on the more common case in which auditors assume subsequent employment with other firms' clients. In a bi-matrix experimental game that captures key features of the strategic tension between auditors and reporters, we find that reporters who have prior experience as an auditor, particularly the experience of having been a diligent auditor, are more sensitive to large penalties for aggressive reporting than are reporters whose experience is exclusively as a reporter. Our results suggest implications for regulators in predicting the effects of reporting penalties and for firms in considering the effects of CPA experience when hiring for reporting positions.