THE EFFECTS OF EXPERIENCE AND TASK-SPECIFIC KNOWLEDGE

THE EFFECTS OF EXPERIENCE AND TASK-SPECIFIC KNOWLEDGE - THE...

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45 45 SIMPOSIUM NASIONAL AKUNTANSI VI Surabaya, 16 – 17 Oktober 2003 THE EFFECTS OF EXPERIENCE AND TASK-SPECIFIC KNOWLEDGE ON AUDITOR’S PERFORMANCE IN ASSESSING A FRAUD CASE RIO TIRTA BPK, Jakarta MAHFUD SHOLIHIN Universitas Gadjah Mada ABSTRACT The objective of this study is to investigate the relationships of auditors’ experience, knowledge, and performance. Specifically, it examined whether the task-specific knowledge variable could affect the relationship between the auditor’s experience and performance in assessing fraud. . The study hypothesized that the difference between experienced auditors and inexperienced auditors’ cue selection performance will be larger in the fraud risk than in the control risk . In addition, it also hypothesized that t ask-specific knowledge will improve auditors’ performance in the fraud risk task, and finally , it hypothesized that the combination of experience and fraud training would improve auditor’s performance in assessing the tasks. Using a sample of 64 auditors and 42 students, the results failed to support the first hypothesis. However, as expected, the study provided support for the second and third hypotheses. Key words: Auditors’ experience; task-specific knowledge; auditors’ performance; fraud. I. Introduction Research on judgment and decision making in accounting and auditing has generally studied the effects of experience on subjects’ performance by using knowledge effects factors. On the other hand, it is rare for those studies to use the fraud assessment case. This research attempted to link these two streams of research. It investigated the relationships among experience, knowledge, and performance. Specifically, it examined whether the task-specific knowledge variable could affect the relationship between the auditor’s experience and performance in assessing fraud case. This study is motivated by several important issues in the judgment and decision making in accounting and auditing area. First , one issue which has earned special attention in the literature is the relationships between experience and performance. Prior studies in this area provide contradictory findings. Some studies indicated that experience should be regarded as an important factor on auditors’ performance prediction (Butt, 1988; Bonner, 1990; Libby and Frederick, 1990; Choo and Trotman, 1991; Tubbs, 1992; Davis, 1996; Shelton, 1999; Knapp and Knapp, 2001). On the other hand, some studies indicated that there are no differences between experienced auditors and inexperienced auditors on auditors’ performance (Ashton, 1974; Ashton and Brown, 1980; Ashton, 1991). These contrary results perhaps can be explained by the consideration of knowledge required to perform the tasks (Frederick and Libby, 1986). Additionally, some studies provided evidence that task-specific knowledge is an important factor to explain the relationship between experience and performance (Frederick and Libby, 1986; Ashton, 1991; Bonner and Lewis, 1990;
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This note was uploaded on 03/01/2011 for the course AKUNTANSI 0806322104 taught by Professor S1 during the Spring '10 term at Universitas Indonesia.

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THE EFFECTS OF EXPERIENCE AND TASK-SPECIFIC KNOWLEDGE - THE...

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