Title: Do experienced auditors have a bias for confirmatory audit evidence?

Authors: Dennis M. O'Reilly; John T. Reisch; Robert A. Leitch

Addresses: Department of Accounting, College of Business, East Carolina University, Greenville, NC 27858-4353, USA ' Department of Accounting, College of Business, East Carolina University, Greenville, NC 27858-4353, USA ' Department of Accounting, The University of South Carolina, Columbia, SC 29208, USA

Abstract: In this study we experimentally test whether experienced auditors display a preference for confirmatory evidence when performing a routine part of a financial statement audit. We theorise that information auditors receive early during an audit leads them to form an initial belief about the correctness of an account balance. Subsequently, auditors may bias their evidence choices in a way that confirms their initial belief. We conducted a 2 × 2 between-subjects experiment with 97 experienced auditors. We manipulated whether early information came from a client's CFO or a firm partner and whether or not it supported the account balance as currently stated. We found that auditors selected more confirmatory evidence after receiving positive information from an audit partner compared to receiving the same information from a client's CFO. We found that experienced auditors selected more confirmatory evidence when the CFO provided negative information relative to when the CFO provided positive information.

Keywords: audit evidence; confirmation bias; evidence search; experienced auditors; auditing; financial statements; initial beliefs.

DOI: 10.1504/IJAAPE.2017.083030

International Journal of Accounting, Auditing and Performance Evaluation, 2017 Vol.13 No.2, pp.187 - 198

Received: 10 Sep 2015
Accepted: 30 Mar 2016

Published online: 02 Mar 2017 *

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