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Unformatted text preview: the WG settings, and the
ANOVA results from Panel A of Table 4 show that this difference is signiﬁcant (p 0.01).
Thus, the group treatment prompts auditors to adopt a defensive posture. Table 4, Panel B
shows that there is no signiﬁcant difference in the managers’ fraud index across the group
settings (p 0.25), indicating that the lower level of auditors’ trust was not triggered by a
higher level of managerial fraud. This result supports H3, that the group treatment affects
Finally, Table 4, Panel C and results from Table 3 indicate that the payoff differences
are lower in the SG setting (p 0.02). Thus, the SG treatment led auditors to choose higher King—Investigation of Self-Serving Biases in an Auditing Trust Game 281 audit levels without managers selecting higher fraud levels, leading to a smaller payoff
disparity between auditors and managers. Panels A, B, and C of Table 4 also indicate that
there are no signiﬁcant interactions between the puffery and group effects for any of the
three measures. Thus, in my setting, the puffery effects and the group effects offset one
another, such that group afﬁliat...
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This note was uploaded on 01/27/2014 for the course ACCY 405 taught by Professor Staff during the Fall '08 term at University of Illinois, Urbana Champaign.
- Fall '08