The Impact of Accounting Students’ Professional Skepticism on their Ethical Perception of Earnings Management

Farag, Magdy; Elias, Rafik Z.

doi:10.1108/s1574-0765(2012)0000016010

Cited by 26 publications

(18 citation statements)

References 20 publications

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“…This study uses accounting students as the participants rather than auditors. Although we have provided strong arguments for the use of final-year accounting students as proxies for entrylevel auditors (Chan & Leung 2006;Farag & Elias 2012;Fleming et al 2010;Geiger & Ogilby 2000;Hughes et al 2009;Kwock et al 2016;Ying & Patel 2016), they have not been exposed to real audit practices. Hence, the participants possibly use their own perceptions to interpret the case given in the experiment.…”

Section: Resultsmentioning

confidence: 94%

“…Similarly, Popova (2012) also reveals that students, as a proxy of entry-level auditors, who maintain a high level of trait skepticism are more skeptical and thus are more likely to choose fraud as their initial expectation of the cause of misstatements. Additionally, Farag and Elias (2012) show that students scoring highly for trait skepticism have a greater tendency to view earnings management as unethical behavior, which can be considered as a more skeptical judgment. Overall, most of the prior studies conclude that auditors with higher levels of professional skepticism behave systematically differently than less skeptical auditors.…”

Section: Education and Trait Skepticismmentioning

confidence: 97%

“…Consistent with prior studies (such as Chan & Leung 2006;Farag & Elias 2012;Fleming et al 2010;Geiger & Ogilby 2000;Hughes et al 2009;Kwock et al 2016;Ying & Patel 2016), this study uses final-year accounting students in both undergraduate and professional programs as proxies for entry-level auditors. Final-year students are used because they have not been influenced by, or directly exposed to, the organizational cultures of audit firms.…”

Section: Introductionmentioning

confidence: 96%

See 2 more Smart Citations

Does Accounting Education Affect Professional Skepticism and Audit Judgment?

Fatmawati

Mustikarini

Fransiska

2018

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This study examines the extent to which enrollment in accounting programs influences students' skepticism levels. We compare the skepticism scores between final-year accounting students in undergraduate and professional programs. This study also investigates the impacts of trait skepticism and situational skepticism on the participants' initial judgment of fraud or errors. Situational skepticism in this study is represented by audit experience from previous years. This study employs an experimental design of 2x3 between-subjects, where trait skepticism is divided into higher and lower levels, and the audit experience from previous years is manipulated into positive, negative and neutral. The participants in this study are 227 accounting students from both undergraduate and professional programs. The results of this study show that accounting students in the professional program are likely to exhibit higher levels of trait skepticism compared to their counterparts in the undergraduate program. The results also indicate that participants make an audit judgment based mainly on their prior experience with the client, not on their trait skepticism. This propensity is more salient particularly in the case of the less-skeptical participants. In sum, the higher that the formal education of a participant is, then the higher is his/her trait skepticism, and thus he/she is able to retain his/her skeptical judgments regardless of his/her prior experience with the client. ABSTRAK Makalah ini mengkaji tahap sejauh mana pendaftaran dalam program perakaunan mempengaruhi tahap skeptisisme pelajar. Kami membandingkan skor skeptisisme di antara pelajar perakaunan akhir tahun dalam program sarjana dan profesional. Kajian ini juga menyelidik kesan skeptisisme bawaan dan skeptisisme keadaan terhadap penilaian awal peserta terhadap penipuan atau ralat. Skeptisisme keadaan dalam kajian ini diwakili oleh pengalaman audit dari tahuntahun sebelumnya. Kajian ini menggunakan reka bentuk eksperimen 2x3 antara subjek, di mana skeptisisme bawaan dibahagikan kepada tahap yang tinggi dan rendah, dan pengalaman audit dari tahun-tahun sebelumnya dimanipulasi menjadi positif, negatif dan neutral. Peserta dalam kajian ini adalah terdiri daripada 227 pelajar perakaunan dari program sarjana dan profesional. Hasil kajian ini menunjukkan bahawa pelajar perakaunan dalam program profesional cenderung menunjukkan tahap skeptisisme bawaan yang lebih tinggi berbanding rakan sejawat mereka dalam program sarjana. Hasil kajian juga menunjukkan bahawa para peserta membuat penilaian audit berdasarkan pengalaman terdahulu mereka dengan klien, dan bukan berdasarkan skeptisisme bawaan mereka. Kecenderungan ini lebih menonjol, terutamanya untuk kes peserta yang kurang skeptikal. Kesimpulannya, semakin tinggi tahap pendidikan formal peserta, semakin tinggi skeptisisme bawaannya, dan dengan itu dapat mempertahankan penilaiannya skeptikalnya tanpa menghiraukan pengalaman terdahulunya dengan klien.Kata kunci: Pendidikan dan latihan; program profesion perakaunan; skeptisis...

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Section: Resultsmentioning

confidence: 94%

Section: Education and Trait Skepticismmentioning

confidence: 97%

Section: Introductionmentioning

confidence: 96%

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Does Accounting Education Affect Professional Skepticism and Audit Judgment?

Fatmawati

Mustikarini

Fransiska

2018

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“…Although this finding suggests that trait skepticism contributes to higher fraud risk assessments, additional research is needed in the area to evaluate that extent that trait skepticism impacts hypothesis generation, audit procedure choice, and fraud detection. If trait skepticism is consistently found to enhance auditors' evaluation of fraud risk, then audit firms may consider measuring their personnel on this dimension and using this information in audit staffing decisions (see Farag and Elias, 2012).…”

Section: Resultsmentioning

confidence: 99%

The effect of alternative fraud model use on auditors’ fraud risk judgments

Boyle

DeZoort

Hermanson

2015

Journal of Accounting and Public Policy

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“…In this paper, we focus on enhancing the professional skepticism of accounting students, as after graduating, some of them are being hired by top auditing firms and become audit assistants. Although it is not formalized anywhere, the leading auditing companies expect graduates who start working in the audit department to show an attitude that, at least to some sufficient level, fits with the definition of professional skepticism provided by the auditing standards [16]. The question of whether it is possible to shape professional skepticism through accounting programs offered at the university level has been largely ignored in prior studies.…”

Section: Introductionmentioning

confidence: 99%

Can We Shape Trait Professional Skepticism through University Accounting Programs? Evidence from Polish University

Ciołek

Emerling

2019

Sustainability

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This paper examines whether it is possible to shape trait professional skepticism of accounting students through undergraduate and graduate university programs. Using Hurtt’s Professional Skepticism Scale (HPSS), we surveyed 432 students of the Poznań University of Economics, who follow either one of the accounting programs or the management program. Comparing the mean scores of first-year undergraduates from each program, who have been studying only for two weeks (initial level of skepticism), with the mean scores of the final-year students as proxies for the entry-level auditors (audit assistants), we calculated the change in the mean scores of students’ trait skepticism over four years of study. The results show that only the ACCA-accredited (Association of Chartered Certified Accountants) accounting program significantly increased the level of trait skepticism of the accounting students in comparison to the control group and students who followed the standard accounting program. The robustness analysis shows that independent variables, such as age, the future job that subjects wish to occupy, and the length of professional experience, have no significant impact on the results obtained. However, that both gender and professional experience have a significant impact on the mean scores may be considered as variables supporting the change of professional skepticism within the four years of study.

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The Impact of Accounting Students’ Professional Skepticism on their Ethical Perception of Earnings Management

Cited by 26 publications

References 20 publications

Does Accounting Education Affect Professional Skepticism and Audit Judgment?

Does Accounting Education Affect Professional Skepticism and Audit Judgment?

The effect of alternative fraud model use on auditors’ fraud risk judgments

Can We Shape Trait Professional Skepticism through University Accounting Programs? Evidence from Polish University

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