Behavioral Research in Accounting (BRIA)



Volume 15

A publication of the Accounting, Behavior and Organizations Section of the American Accounting Association



Table of Contents


John C. Anderson, Kimberly K. Moreno, and Jennifer M. Mueller


Donna D. Bobek and Richard C. Hatfield


Mandy M. Cheng, Peter F. Luckett, and Axel K-D. Schulz


Mandy M. Cheng, Axel K-D. Schulz, Peter F. Luckett, and Peter Booth


David P. Donnelly, Jeffrey J. Quirin, and David O’Bryan


Christine E. Early



The Effect of Client vs. Decision Aid as a Source of Explanations upon Auditors’ Sufficiency Judgments: A Research Note


John C. Anderson

San Diego State University


Kimberly K. Moreno

Virginia Polytechnic Institute and State University


Jennifer M. Mueller

Auburn University


ABSTRACT: This study examines whether auditors will rate explanations for an unusual fluctuation provided by a decision aid as more sufficient than the same explanations provided by a client, when the explanations are insufficient to account for the fluctuation. While prior research has addressed auditors’ sensitivity to the source reliability of various parties (e.g., client management, outside parties), little is known about auditors; perceptions of decision aids as an information source. Since a decision aid may be viewed as a highly objective source, auditors may tend to over-rate the sufficiency of explanations provided by a decision aid vs. those provided by a client. Our results show that auditors rated explanations provided by a decision aid as more sufficient than the same explanations provided by the client, when in fact the explanations were insufficient. These results suggest that more consideration be given to the impact of decision aids utilized in analytical review.


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An Investigation of the Theory of Planned Behavior and the Role of Moral Obligation in Tax Compliance


Donna D. Bobek

University of Central Florida


Richard C. Hatfield

The University of Texas at San Antonio


ABSTRACT: In this study, Ajzen’s (1991) Theory of Planned Behavior is used as a theoretical framework to extend prior research examining taxpayers’ compliance intentions. Specifically, moral obligation is added to the theory’s explicit constructs: attitude, subjective norms (i.e., peer influence), and perceived behavioral control. Moral obligation was expected to be a moderating influence (Reckers et al. 1994), and therefore interaction effects were hypothesized.


The study was conducted in two phases. In the first phase, a procedure was used to determine the outcome beliefs that underlie taxpayers’ attitudes. These beliefs were incorporated into an attitude measure used in the second phase in which subjects responded to two of three tax-compliance scenarios. The data from phase two were analyzed using multinomial logistic regression. The results indicate that the model including moral obligation, provides a significant explanation of tax noncompliance in the three different scenarios. However, the interaction effect of moral obligation appears to be more complex than the relationship suggested by Reckers et al. (1994).


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The Effects of Cognitive Style Diversity on Decision-Making Dyads: An Empirical Analysis in the Context of a Complex Task


Mandy M. Cheng

Peter F. Luckett

The University of New South Whales


Axel K-D. Schulz

The University of Melbourne


ABSTRACT: Some research has suggested multiple-format accounting feedback in an attempt to accommodate varying cognitive information processing styles (Gardner and Martinko 1996). This costly information solution, however, has not been widely adopted in practice. An alternative approach, which fits nicely with current team-orientation practices in the work place, is to create combinations of workers. These work groups can bear varying cognitive styles in solving complex business problems using accounting information. This study explores how cognitive style diversity affects the decision quality performance of dyads for a complex decision task. An experiment was performed to extend prior accounting studies into perception differences based on the sensor/intuitive dimension of the MBTI (Myers-Briggs Type Indicator) instrument, and how such differences affect users of performance reports in their decision-making processes. In this study, subjects were classified into sensor or intuitive dyad members, based on the Myers-Briggs MBTI instrument, and engaged in a task that involved a series of simulation production decisions with nonfinancial direct performance feedback. After controlling for task conflict, results showed significantly better decision performance for cognitively diverse dyads over homogenous sensor dyads. Similar performance differences, however, were not observed between cognitively diverse dyads and homogenous intuitive dyads. Task conflict was not significant in explaining differences in decision performance. These findings could have implications in the areas of management control system design and personnel management.


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The Effects of Hurdle Rates on the Level of Escalation of Commitment in Capital Budgeting


Mandy M. Cheng

The University of New South Whales


Axel K-D. Schulz

The University of Melbourne


Peter F. Luckett

The University of New South Whales


Peter Booth

University of Technology, Sydney


ABSTRACT: This study proposes that organizations should consider project hurdle rates, as part of their control system design, to reduce escalation of commitment behavior in managers. In particular, we empirically examined the escalation of commitment tendencies in managers receiving organization-set, self-set, and no hurdle rates.


Consistent with prior expectations, we found self-set hurdle rates to be an effective control mechanism resulting in significantly lower levels of escalation of commitment. Contrary to expectations, however, organization-set hurdle rates were not effective. Self-set hurdle rates also resulted in significantly higher cut-off rates compared to the average return of the investment portfolio held by the managers.


As escalation of commitment has been recognized as a serious potential problem in organizations, the use of self-set hurdle rates is a step toward reducing the level of escalation tendencies in managers.


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Auditor Acceptance of Dysfunctional Audit Behavior: An Explanatory Model Using Auditors’ Personal Characteristics


David P. Donnelly

University of Nevada, Las Vegas


Jeffrey J. Quirin

Wichita State University


David O’Bryan

Pittsburg State University


ABSTRACT: Dysfunctional behavior (DB) and staff turnover are associated with decreased audit quality (Public Oversight Board 2000). Dysfunctional behaviors such as premature sign-ff, gathering of insufficient evidence, altering or replacing audit procedures, and underreporting of time have negative effects on the auditing profession. While recent studies suggest that dysfunctional behavior is a widespread problem (Smith 1995; Otley and Pierce 1995), extant research fails to adequately explain the causes. In this study, the organizational behavior and industrial psychology literatures provide the basis for developing and testing a model that identifies locus of control, performance, and turnover intentions as determinants of auditor acceptance of DB.


Using cross-organizational design and a structural equation modeling technique, survey results from 106 auditors generally supported the explanatory model. Results indicate that auditors who are more accepting of DB ten to possess an external locus of control, report lower levels of self-rated performance, and exhibit higher turnover intentions. These results suggest that individual auditor characteristics play a role in identifying those who are more accepting of DB.


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A Note on Self-Explanation as a Training Tool for Novice Auditors: The Effects of Outcome Feedback Timing and Level of Reasoning on Performance


Christine E. Early

University of Connecticut

ABSTRACT: This study extends a previous experiment (Earley 2001), showing how a “self-explanation” training intervention promoted learning in an auditing context. A causal model is proposed to examine the effect of providing outcome feedback (i.e. the correct answer) prior to or after self-explaining on the level of reasoning exhibited in self-explanations, and then the effect of level of reasoning on performance.


The model was tested through an experiment in which auditors were trained to assess the reasonableness of client-provided discount rates used in real estate valuation. The following three relationships were tested: (1) the effect of outcome feedback timing on the level of reasoning exhibited, (2) the effect of outcome feedback timing (without considering reasoning level) on performance, and (3) the diminishing effect of outcome feedback timing on performance when level of reasoning is introduced as a covariate, with level of reasoning then having a significant effect on performance. The results support the causal model, indicating that in the absence of outcome feedback, auditors exhibit a lower level of reasoning in their self-explanations, which then adversely affect their performance.


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