The effects of trust, client importance, and goal commitment on auditors' acceptance of client-preferred methods

Kerler, William A.; Brandon, Duane M.

doi:10.1016/j.adiac.2010.04.003

Cited by 25 publications

(29 citation statements)

References 44 publications

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“…Previous research suggests that the effect of management integrity is largely subconscious (Kaplan, O'Donnell, & Arel, 2008;Kerler & Brandon, 2010;Kizirian et al, 2005;Peecher, 1996). Hurtt, Brown-Liburd, Earley, and Krishnamoorthy (2013) argue that although an auditor might understand that management is not an objective source and may have incentives to hire a particular ME, which they are unlikely to reveal to the auditor, subconsciously auditors could be inclined to rely on client-provided explanations unless the auditor has a reason to doubt these explanations.…”

Section: Discussionmentioning

confidence: 99%

External auditors' evaluation of a management's expert's credibility: Evidence from Australia

2020

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The Australian Securities and Investments Commission (ASIC) has concerns that auditors are not adequately evaluating the reliability of the work of management's experts (MEs). We interviewed nine experienced auditors to understand how auditors evaluate MEs. We observe that some factors specified by auditing standards, such as an ME's competency in accounting standards, geographical location of the subject matter or the ME, and the sourcing of an ME play a minor role in an auditor's evaluation of an ME's credibility. In contrast, the reputation of an ME's firm is a key determinant. Auditors corroborate information from multiple sources, but verify only the ME's professional qualification. We identify three potential reasons for the ASIC's concerns: "Experts are considered cognitive authorities,""Documentation is the key," and "Move from a risk-based approach to a checklist approach."

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Section: Discussionmentioning

confidence: 99%

External auditors' evaluation of a management's expert's credibility: Evidence from Australia

2020

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“…Auditor-client relationships and independence concerns are at the forefront of several highprofile accounting scandals (Kerler and Brandon 2010). Consequently, many would likely wince at the notion of advocating for close auditor-client relationships.…”

Section: Discussion and Practical Implicationsmentioning

confidence: 99%

How Client Identification and Client Commitment Uniquely Influence Auditor Objectivity

Herda¹,

Lavelle²

2015

Current Issues in Auditing

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SUMMARY This article summarizes our recent study, “Client Identification and Client Commitment in a Privately Held Client Setting: Unique Constructs with Opposite Effects on Auditor Objectivity” (Herda and Lavelle 2015), which examines how individual auditors' identification with, and commitment to, privately held audit clients affects their objectivity. Based on a survey of 102 external auditors, we find that client identification is distinct from client commitment. This distinction is important because identification as a construct is easily and often confused with commitment, and the terms are often used interchangeably. Client identification entails auditors perceiving themselves as one with the client. In contrast, client commitment reflects a responsibility for and dedication to the client, but the auditor and client remain separate psychological entities. Consistent with prior research, we find that client identification impairs auditor objectivity. Conversely, we find that client commitment enhances auditor objectivity.

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“…Auditor menjadikan perusahaan tersebut sebagai klien penting (client importance) karena menjadi sumber pendapatan bagi auditor (Fitriany, 2012). Client importance didefinisikan sebagai pentingnya keuangan relatif dari klien bagi auditor atau KAP (Kerler dan Brdanon, 2010).…”

Section: Pendahuluanunclassified

“…Tingkat obyektifitas dan independensi auditor akan menurun ketika auditor memdanang kliennya sebagai klien penting (client importance) yang berpotensi sebagai sumber pendapatan dalam jangka panjang. Pentingnya klien (client importance) didefinisikan sebagai pentingnya keuangan relatif dari klien bagi auditor atau KAP (Kerler dan Brdanon, 2010).…”

Section: Client Importanceunclassified

“…Pentingnya klien (client importance) didefinisikan sebagai pentingnya keuangan relatif dari klien bagi auditor atau KAP (Kerler dan Brdanon, 2010). Auditor akan memdanang kliennya sebagai sebuah perusahaan yang berpotensi besar dimasa yang akan datang yang akan terus mempekerjakan mereka sehingga timbul ketergantungan ekonomi.…”

Section: Client Importance Sebagai Variabel Bebas (X)unclassified

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Peranan Komitmen Profesi Akuntan Dalam Memoderasi Pengaruh Client Importance Pada Kualitas Audit

Devi

Dewi

2019

Jurnal Riset Akuntansi Dan Bisnis Airlangga

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This research was done in purpose of finding out empirical evidences about theeffects of client importance towards the audit quality, dan the commitment ability of the accounting profession in weakening the influence of client importance on audit quality. The research sample that returned the results of questionnaires is 36 auditors from a total of 65 auditors working in the Public Accounting Firm (KAP) in 2018. The sample selection was done using the purposive sampling method. The data sources used in this study are primary data. Primary data is obtained by using a questionnaire that has been structured in order to collect information from the auditor as the respondent in this study. MRA model analysis was applied to analyze the data. The data analysis support the hypothesis: (1) client importance has negative dan significant effect towards the audit quality, dan (2) commitment of the accounting profession was able to moderate the influence of client importance on audit quality. The results of this study can be used as reference material for KAP leaders in evaluating dan performing more strict supervision on the implementation of professional commitment of auditors when conducting audit process, because the existence of KAP depends on the quality of audits that can affect public trust. Regulators can also make very strict rules dan sanctions related to violations of the accounting code of ethics dan violations of the audit process so that they can cause deterrent effects for the perpetrators dan can be used as learning for other auditors so as not to violate these rules.

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The effects of trust, client importance, and goal commitment on auditors' acceptance of client-preferred methods

Cited by 25 publications

References 44 publications

External auditors' evaluation of a management's expert's credibility: Evidence from Australia

External auditors' evaluation of a management's expert's credibility: Evidence from Australia

How Client Identification and Client Commitment Uniquely Influence Auditor Objectivity

Peranan Komitmen Profesi Akuntan Dalam Memoderasi Pengaruh Client Importance Pada Kualitas Audit

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