The comparative effect of process and outcome accountability in enhancing professional scepticism

Responding to concerns about insufficient professional scepticism in audits (e.g. PCAOB, 2011 , 2012 ; ASIC, 2012 ), we investigate the effect of process and outcome accountability in enhancing the level of professional scepticism and the differences in effects across audit experience levels. In our experiment, we manipulate the type of accountability (outcome versus process) for both novice auditors and audit seniors. We examine the effect on four measures of professional scepticism and find that auditors show greater levels of professional scepticism when they are expected to justify their judgment process, rather than their final judgments. Our results also show that the professional scepticism of novice auditors improves to a greater extent than that of more experienced auditors (audit seniors) under process accountability.