Auditors are getting more vigilant about beating up on the risk of management bias in arriving at accounting estimates, but not so much when it comes to the risk of measurement imprecision.
New academic research emerging from the University of Arizona says the risk of error in accounting estimates due to imprecise measurement methods is just as important as the risk of management bias, but it isn’t getting the same level of attention from regulators. That means it’s not getting the same level of attention from auditors either.
