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The effects of trust and management incentives on audit committee judgments
journal contribution
posted on 2023-05-17, 04:16 authored by Rose, A, Rose, J, Dibben, MRWe investigate the effects of audit committee members' dispositional trust and management incentives on audit committee judgments. Results of an experiment indicate that: (1) When management has incentives to manage earnings, less trusting audit committee members are more likely to support the external auditor than are more trusting audit committee members; (2) when management has incentives to manage earnings, less trusting audit committee members are more likely to perceive that management is not credible, and more likely to perceive that management is being deceptive than are more trusting audit committee members; and (3) the interactive effects of trust and incentives on decisions to support the auditor are mediated by perceptions of management's intent to deceive. That is, less trusting audit committee members perceive that management's incentives to manage earnings result in potential deception by management, and less trusting audit committee members increase their support for the auditor because of concerns about management deception.
History
Publication title
Behavioral Research in AccountingVolume
22Pagination
87-103ISSN
1050-4753Department/School
TSBEPublisher
American Accounting AssociationPlace of publication
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Copyright © 2010 American Accounting AssociationRepository Status
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