Abstract This paper contains evidence of error characteristics and environmental factors for a sample of 260 audit engagements, including findings with respect to: (1) incidence and magnitude by account; (2) types, causes, and methods of detection; (3) association with client size, industry, and SEC status; and (4) relationship to environmental factors. The evidence has implications for auditors in designing audit procedures for the detection of errors.
Kreutzfeldt et al. (Mon,) studied this question.