New academic research suggests audit reviewers in some cases might be giving audit teams the benefit of the doubt, even when they try not to do so.
In a study recently published by the American Accounting Association, Vicky Hoffman, a professor at the University of Pittsburgh, and doctoral candidate Michele L. Frank, say they have spotted a weakness in the audit review process after conducting an online experiment with nearly 120 Big 4 audit managers and senior managers. They asked the managers to take a look at a hypothetical audit situation and conclude whether they concurred with an audit determination regarding an inventory writedown of $1.2 million.
