The directionality of uncertainty expressions and the foreign language effect

Abstract

Purpose This study aims to investigate two issues inherent in accounting judgements: the directional influence of uncertainty expressions and how they might positively or negatively affect accounting judgements and the foreign-language effect (FLE), which refers to the reduction of judgement bias that occurs when an accounting judgement is made in one’s foreign language. This study examines both issues in the context of accounting judgements made in Chinese and English languages. Design/methodology/approach This study conducted two experiments. The first experiment applied a 2 × 2 between-subject research design, and the second experiment adopted a 2 × 2 within-subject approach. Findings The overall results revealed that directionality biases existed in the exercise of accounting judgement in subjects’ native and foreign languages. However, when the language was switched from the subjects’ native tongue to a foreign language, overall directionality biases are reduced. Research limitations/implications This study suggests that the use of native and non-native languages can have unintended consequences on accounting judgements. However, because of the limitations of using students as proxies for professionals and applying self-assessed language scales, the literature would benefit from future research that extends the subject profile to professional accountants and that assesses language skills more objectively. Originality/value This study contributes to the literature on cross-lingual accounting, both theoretically and methodologically. It also extends the FLE theory to an accounting context, providing insights on how language is involved in judgements concerning uncertainty expressions.

Communicating uncertainty using words and numbers

“…The interindividual variability in numeric interpretations of verbal probabilities [51] continues to be observed in English-speaking samples, and is evident among experts/professionals [25][26][27]30,34,35,52,53] as well as lay people (e.g., [17,19,20,24,32,36,[44][45][46][47]54,55]). Such variability is also documented among non-native English-speakers, where probability terms may or may not be translated [7,28,35,49,56,57]. These non-native language users have reduced numeric discriminability of terms that lie above and below the mid-point of the probability scale [7,49,57].…”

“…Such variability is also documented among non-native English-speakers, where probability terms may or may not be translated [7,28,35,49,56,57]. These non-native language users have reduced numeric discriminability of terms that lie above and below the mid-point of the probability scale [7,49,57].…”

“…The 'membership function' method maps a term onto a 'goodness-of-meaning' curve over the probability interval (Figure 1). Some studies elicit full membership functions [24,30,34,36,[44][45][46], while others ask for a three-point (i.e., best, lower, and upper bound) or single-point (i.e., best) interpretation (e.g., [7,26,28,34,[47][48][49]). The findings based on numeric measurement approaches are compatible with those grounded in non-numeric approaches (e.g., [23,30,50]).…”

“…These polarity effects have been observed for an increase/decrease in accounting [56], success/failure in intelligence analysis [53], and being hesitant/willing to act in a legal setting [44] (Figure 1). Contexts can even reduce the numeric discriminability of probability terms [49,53]. Terms ranked below the mid-point of the well they think each numeric probability value (e.g., 0, 0.5, 0.10,…1) represents a specific term (e.g., likely).…”

“…Positively directional terms (e.g., small probability) bring to mind the occurrence of an outcome, whereas negatively directional terms (e.g., unlikely) suggest nonoccurrence [55]. This directionality (or attentional focus) is stronger when terms are expressed in an individual's native language [49]. Therefore, words can be used to affirm or negate the numeric probability underlying an outcome (e.g., by using a positive term to convey a <0.5 probability and a negative term for >0.5).…”