What question did this study set out to answer?

To examine whether decomposing fraud-risk assessments using the fraud triangle improves auditors' sensitivity to incentive and opportunity cues when management attitude reflects low fraud risk.

September 1, 2004Contemporary Accounting Research

Decomposition of Fraud‐Risk Assessments and Auditors' Sensitivity to Fraud Cues*

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Authors

TWT. Jeffrey Wilks MZMark F. ZimbelmanBrigham Young University

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Implication

Experimental study reveals that decomposing fraud-risk assessments increases sensitivity to low-risk cues in audit managers, highlighting limits in mitigating bias toward management.

Key Points

To examine whether decomposing fraud-risk assessments using the fraud triangle improves auditors' sensitivity to incentive and opportunity cues when management attitude reflects low fraud risk.
Conducted an experimental study with 52 practicing audit managers assigned to evaluate fraud risk using either a decomposed approach or a holistic approach.
Auditors who decomposed fraud-risk assessments demonstrated higher sensitivity to incentive and opportunity cues when formulating overall assessments than those conducting holistic assessments.
The increased cue sensitivity associated with decomposition occurred exclusively when opportunity and incentive cues signaled low fraud risk, showing identical sensitivity to holistic evaluations when cues indicated high fraud risk.

Cite This Study

Wilks et al. (2004) studied this question.

synapsesocial.com/papers/69d8fec2d2f7327e70ae4c1e https://doi.org/10.1506/hgxp-4dbh-59d1-3fhj

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Implication

Experimental study reveals that decomposing fraud-risk assessments increases sensitivity to low-risk cues in audit managers, highlighting limits in mitigating bias toward management.

Decomposition of Fraud‐Risk Assessments and Auditors' Sensitivity to Fraud Cues*

Discussion

Member takes

Implication

Key Points

Cite This Study

Decomposition of Fraud‐Risk Assessments and Auditors' Sensitivity to Fraud Cues*

Discussion

Member takes

Implication

Key Points

Cite This Study

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