Table of Contents
The Effects of Flexible Work Arrangements
on Stressors, Burnout, and Behavioral Job Outcomes
in Public Accounting
Elizabeth Dreike Almer
Portland State University
Steven E. Kaplan
Arizona State University
ABSTRACT: The majority of public
accounting firms now offer flexible work arrangements to their professional
employees. Presumably these arrangements help accommodate employee needs to
manage work and family demands, while also improving job satisfaction and
retention. The ability of flexible work arrangements to achieve these goals has
received little attention. The current paper addresses this issue by reporting
the results of a survey of CPAs working under a flexible work arrangement and a
similar group of CPAs working under a standard arrangement but who appear to be
plausible candidates for a flexible work arrangement. The survey elicited
information about several key employment variables: job-related stressors
(e.g., role conflict, role ambiguity, and role overload), burnout tendencies
(e.g., emotional exhaustion, reduced personal accomplishment, and
depersonalization) and behavioral job outcomes (e.g., job satisfaction and
turnover intentions).
Results show that CPAs on flexible
work arrangements report higher job satisfaction and lower turnover intentions
than those on a standard work arrangement. CPAs on flexible work arrangements
generally have lower levels of burnout and stressors, though the reduced
personal accomplishment burnout dimension may be conditioned upon whether the
CPA has a mentor. Finally, for professionals switching to a flexible work
arrangement, respondents indicated a significant improvement in job
satisfaction and turnover intentions as well as some decline in burnout and
stressors.
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An Empirical Examination of
Competing Theories to Explain the Framing Effect
in Accounting-Related Decisions
C. Janie Chang
San Jose State University
Sin-Hui Yen
Tamkang University
Rong-Ruey Duh
National Taiwan University
ABSTRACT: The purposes of this study
are to explore framing effects in a managerial accounting decision context and
to test the explanatory power of prospect theory and two competing theories,
fuzzy-trace theory and probabilistic mental models, on such effects. In
Experiment 1, 86 undergraduate students made a choice between two alternatives
in a managerial decision problem that illustrates a classic, Asian disease-type
business scenario. Results show that the subjects committed the framing effect
bias and that prospect theory, fuzzy-trace theory, and probabilistic mental
models all predict the bias. In Experiment 2, a business variant of the Asian
disease problem was designed to distinguish among the explanatory abilities of
these theories in an accounting context. One hundred eighty-five undergraduate
students participated in the experiment. Results of Experiment 2 indicate that
the fuzzy-trace theory provides additional power to explain the framing effect.
Hence, accounting professionals can design better approaches to
reporting/presenting financial information that will help managers alleviate
the framing effect in decision making.
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Budget Goal Commitment and Informational Effects
of Budget Participation on Performance:
A Structural Equation Modeling Approach
Vincent K. Chong
The University of Western Australia
Kar Ming Chong
The University of New South Wales
ABSTRACT: This paper examines budget
goal commitment and informational effects of budget participation on
performance. A structural model is proposed and tested that includes budget
participation, budget goal commitment, job-relevant information, and job
performance variables. The data were collected by survey questionnaires.
Seventy-nine middle-level managers, drawn randomly from a cross-section of
manufacturing companies in Australia, participated in the project. A structural
equation modeling technique was used to test hypothesized linkages. Support was
found for the effects of budget goal commitment and informational roles of
budget participation on job performance.
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A Research Note on the Influence of Outcome Knowledge
on Audit Partners’ Judgments
Craig Emby
Alexander M. G. Gelardi
Simon Fraser University
D. Jordan Lowe
University of Nevada, Las Vegas
ABSTRACT: Audit partners may be
called upon to evaluate, ex post, the work of another auditor. One example of
such an evaluation is a Peer Review. An experiment was conducted that examined
the influence of outcome knowledge on the going concern and peer evaluation
judgments of 122 audit partners from Canada and the United States. Outcome
information was manipulated at three levels—no outcome, negative outcome,
and positive outcome information. The results confirm previous research and
show that audit partners are subject to the influence of outcome information.
Negative outcome information influenced (1) audit partners’ assessments of
the likelihood of the client’s continued existence (hindsight effects),
(2) the evaluation of the incumbent auditor’s judgment (outcome effects),
and (3) judgments of the importance of evidence items. Auditors who received
outcome information tended to rate outcome-consistent items of evidence as more
important. This suggests that the biasing effect of outcome knowledge operates
by acting as a filter that magnifies the relative salience of
outcome-consistent information.
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Workplace Environment in a Professional Services
Firm
Karen L. Hooks
Julia L. Higgs
Florida Atlantic University
ABSTRACT: This paper is based on
survey results from 1,055 partners and employees of an international
professional services firm regarding the workplace environment. Data collected
address influences on work schedules, work time and locations, work with
technology, and choices to work from home. The results suggest that client,
organizational, and personal factors influence the work environment, and that
the use of technology enables flexibility. The survey results are discussed
referencing concepts of motivation, productivity, supervision, and control;
empowerment and implications for accounting research are proposed.
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Investors’ Use of Analysts’
Recommendations
Ranjani Krishnan
Michigan State University
Donna M. Booker
University of Cincinnati
ABSTRACT: This study examines the
factors influencing the decisions of investors who use analysts’
recommendations to arrive at a short-term decision to hold or to sell a stock.
Specifically we examine if the presence of analysts’ recommendations
reduces the tendency for investors to commit the disposition error, i.e., sell
winning stocks too soon and hold losing stocks too long. We also examine
whether the strength of supporting arguments to the analysts’
recommendations affects investor decisions. Our results indicate that the
presence of an analyst summary recommendation report reduces the disposition
error for gains but not for losses. A strong form of the analyst summary
recommendation report, i.e., one with additional information supporting the
analysts’ position further, reduces the disposition error for gains and
also reduces the disposition error for losses.
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Decision Aids for Generating Analytical Review Alternatives:
The Impact of Goal Framing and Audit-Risk Level
Jennifer M. Mueller
Auburn University
John C. Anderson
San Diego State University
ABSTRACT: An auditor generating
potential explanations for an unusual variance in analytical review may utilize
a decision aid, which provides many explanations. However, circumstances of
budgetary constraints and limited cognitive load deter an auditor from using a
lengthy list of explanations in an information search. A two-way
between-subjects design was created to investigate the effects of two
complementary approaches to trimming down the lengthy list on the number of
remaining explanations carried forward into an information search. These two
approaches, which represent the same goal (reducing the list) but framed
differently, are found to result in a significantly different number of
remaining explanations, in both low- and high-risk audit environments. The
results of the study suggest that the extent to which an auditor narrows the
lengthy list of explanations is important to the implementation of decision
aids in analytical review.
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Evidence of an Association between
Error-Specific Experience and Auditor Performance
during Analytical Procedures
Ed O’Donnell
Arizona State University
ABSTRACT: This study examined
whether error-specific experience can improve auditor performance during
analytical procedures. In a field experiment, practicing auditors with
different amounts of experience used analytical procedures to diagnose the
reason for an unexpected interperiod change in an account balance. Analyses
controlled for the influence of (1) general audit experience, (2)
industry-specific experience, and (3) error-specific experience. Findings
suggest that, for participants with less general experience, error-specific
experience increased the likelihood that they would provide a correct
explanation. However, the benefits of error-specific experience diminished as
general experience increased. One interpretation is that error-specific
experience provides little or no incremental benefit for auditors who have
already developed, through general experience, the analytical skills they need
to perform effectively. These results provide evidence that error-specific
experience could be a surrogate for the learning opportunities made available
through general experience. Research that explores how error-specific
experience might be provided through training is suggested.
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Behavioral Implications of Information Systems
on Disclosure Fraud
Steven T. Schwartz
SUNY at Binghamton
David E. Wallin
The Ohio State University
ABSTRACT: This paper uses a
laboratory setting to investigate behavioral issues related to disclosure
fraud. Subjects issued disclosures under one of two settings. They either
knowingly issued fraudulent reports or they allowed an information system to
issue fraudulent reports at a chosen rate. The settings were economically
equivalent and each mechanism allowed for an implementation of the
profit-maximizing strategy. The central question is one of the relative effect
of the available method of lying on the frequency of lying. The results show
that when subjects were distanced from the fraud through use of an information
system, they made choices that would maximize their earnings. However, making
subjects more closely involved with the disclosure reduced the rate of
fraudulent disclosures by 30 percent. Differences in female and male rates of
fraudulent reporting waned over time.
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The Effect of the Busy Season Workload
on Public Accountants’ Job Burnout
John T. Sweeney
Washington State University
Scott L. Summers
Brigham Young University
ABSTRACT: Anecdotal evidence
suggests that the escalated workload of the public accounting “busy
season” is a major contributor to employee “burnout.” Academic
research on the psychological impact of the busy season workload, however, is
virtually absent from the accounting literature. We partially address this void
by employing a longitudinal design and structural equation modeling to examine
the causal impact of the busy season workload on public accountants’ job
burnout—a dysfunctional stress syndrome. Prior to the start of the busy
season and again at its end, we measured hours worked, role stressors, and job
burnout for a sample of public accountants from a national firm. The results of
our analyses indicate that public accountants’ pre-busy season burnout was
not directly affected by hours worked, even though subjects reported an average
workload of 49 hours per week. This result implies that public accountants may
develop a relatively high workload threshold before it directly impacts their
job burnout. During the busy season, our subjects’ weekly workload
increased to approximately 63 hours. The additional workload burden introduced
by the busy season caused job burnout for our sample of public accountants to
rise to levels rarely reported in the research literature.
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The Influence of Fairness Perceptions and Goal Commitment
on Managers’ Performance in a Budget Setting
Kristin Wentzel
La Salle University
ABSTRACT: Recent budgeting research
suggests that fairness perceptions play a role in performance. In particular,
prior work demonstrates a positive relation between fairness and performance
during budgeting. The process by which fairness perceptions translate into
improved performance, however, remains unaddressed. This study contributes to
the accounting literature by investigating whether fairness perceptions improve
performance via participation by increasing managers’ commitment to
budgetary goals. Structural equation models are proposed in which both fairness
perceptions and goal commitment influence managers’ performance during
budgeting. Questionnaire data collected from one field site in the midst of
downsizing were used to test the models. The results suggest that increased
participation during budgeting fosters a sense of fairness, which, in turn,
increases managers’ commitment to budgetary goals and subsequently
enhances performance ratings. The direct path between fairness perceptions and
performance, however, appears to be insignificant when goal commitment is
considered.
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