Root Cause Analysis and its Effect on Auditors’ Judgments and Decisions in an Integrated Audit

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dc.contributor.authorDeZoort, Todd
dc.contributor.authorDoxey, Marcus
dc.contributor.authorPollard, Troy
dc.date.accessioned2024-02-21T19:55:01Z
dc.date.available2024-02-21T19:55:01Z
dc.date.copyright© 2021 Wiley
dc.date.issued2021-06
dc.description.abstractThis study evaluates whether auditor use of root cause analysis (RCA) for an identified client misstatement affects auditors’ assessments of underlying control issues and materiality in an integrated audit setting. We also test whether auditor cognitive style moderates these effects given prior findings that a misfit between task structure and cognitive style undermines performance. We randomly assigned 147 auditors to four RCA treatments (No RCA, Unstructured RCA, Structured “5 Whys” RCA, Structured “Fishbone” RCA). The results suggest that auditors using (not using) structured RCA are more (less) likely to identify control-related root causes of a financial misstatement and judge the misstatement to be more (less) material. We also find that the assessed severity of identified control deficiencies mediates RCA’s effect on materiality judgments. Finally, the materiality judgment results reveal a significant interaction between structured RCA method and auditor cognitive style, suggesting the importance of allowing flexibility in the specific RCA method applied in practice.
dc.format.mimetypeapplication/pdf
dc.identifier.citationDeZoort, T., Doxey, M. and Pollard, T. (2021), Root Cause Analysis and Its Effect on Auditors' Judgments and Decisions in an Integrated Audit†. Contemporary Accounting Research, 38: 1204-1230. https://doi.org/10.1111/1911-3846.12649
dc.identifier.doihttps://doi.org/10.1111/1911-3846.12649
dc.identifier.issn1911-3846
dc.identifier.urihttps://ir.ua.edu/handle/123456789/13189
dc.languageEnglish
dc.language.isoen_US
dc.publisherWiley
dc.rights.licenseThis work is licensed under a CC BY-NC 4.0 license.
dc.subjectIntegrating audits
dc.subjectCognitive fit
dc.subject.lcshRoot cause analysis
dc.subject.lcshAuditing, Internal
dc.titleRoot Cause Analysis and its Effect on Auditors’ Judgments and Decisions in an Integrated Audit
dc.typeArticle

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