Table 5 summarizes the three measures for the regular

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Unformatted text preview: ions appear to ameliorate the dysfunctional tendency to fall prey to puffery. Results for H4: Comparing Audit Levels across the Resolution and Regular Play Phases Hypothesis 4 (Null) predicts auditors’ choices will not change after observing managers’ choices from the regular play phase. The alternative predicts that information auditors receive about the managers’ fraud level will lead them to choose higher levels of auditing during the resolution phase. Evidence that auditors increase their level of auditing during the resolution phase, would suggest that auditors’ expectations are not in equilibrium in the regular play phase. Table 5 summarizes the three measures for the regular play and the resolution phases. For NP/WG, the audit index was higher in the resolution phase (104.55), than in the regular play rounds (82.14). This difference is marginally significant (p 0.07) based on 11 matched pairs. There is a marginally significant increase in auditing in the other three settings, based on the average audit index. When I pool all the data across the 44 subjects, I do observe a significant incr...
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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.

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