The effect of audit outcomes on evaluators' perceptions

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Purpose Examines the effects of the outcome of an over-budget audit on supervisors' perceptions of the auditor's performance. Design/methodology/approach Uses a cognitive model developed by Lipe. In a computer-based experiment and an external audit context, professional auditors assumed the role of a supervisor evaluating a subordinate. Participants assessed the excess audit time in terms of perceived benefits to the firm and subsequently evaluated the job performance of the auditor. Findings The results provide partial support for Lipe's model, but differ in some respects. Interestingly, the effect of audit findings on the perceived benefit to the firm was not significant after considering experience in public accounting, but experience was not related to the actual performance evaluation. Instead, the audit outcome significantly affects the evaluation. Originality/value The level of benefit perceived from the audit was also associated with framing the audit time in terms of a “cost” or “loss”. Finally, as subjects tended toward framing the excess time as a “cost”, they evaluated the auditor more favorably. © 2005, Emerald Group Publishing Limited

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Managerial Auditing Journal

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