Journal of Undergraduate Research


judging juror judgment, reduced audit, quality acts


Marriott School of Business




As watchdogs of public companies’ financial reporting, auditors have the responsibility to attest whether a firm’s financial statements fairly represent its finances. As such, auditors are subject to professional standards to ensure high-quality audits. At times, however, auditors fail to meet these standards with their actions. Such actions, “which reduce evidence-gathering effectiveness inappropriately” (Malone and Roberts 1996), are referred to in the academic research literature as reduced audit quality acts (RAQAs). RAQAs increase the risk of inappropriate or misleading audit opinions, which can harm investors, lenders, and other parties, and which often lead to litigation. We seek to determine how jurors’ judgments in such cases are affected by conditions commonly surrounding RAQAs. We hypothesize that jurors are more likely to find the audit firm at fault when the RAQA is directly related to the area of misstatement than when it occurs in an unrelated area, as well as when the auditor is a higher-level partner rather than a lower-level senior.

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