The Sequencing of Audit Evidence: Its Impact on the Extent of Audit Testing and Report Formulation

Auditing is a sequential process in which an auditor evaluates pieces of evidence relative to audit assertions. Hogarth and Einhorn (1992) have recently developed a descriptive model of the belief revision process which predicts a recency effect when a short series of complex, mixed evidence is evaluated. A number of studies in auditing have found such effects in auditors ‘belief revisions. An unanswered question, however, is whether such recency effects lead to different actions on the part of auditors. Two experiments were conducted to determine whether recency effects found in the auditors’ belief revisions lead to different actions. The results show that recency effects occurred but that they do not appear to result in different levels of audit testing or in the issue of different audit reports.