Current Search:   Trompeter, Gregory (x)

View All Items

  • CSV Spreadsheet
(1 - 5 of 5)
Three Studies Examining the Effects of Business Analytics on Judgment and Decision Making in Accounting
Title
Three Studies Examining the Effects of Business Analytics on Judgment and Decision Making in Accounting.
Creator
Lang, Bradley, Trompeter, Gregory, Robb, Sean, Tian, Yu, Trinkle, Brad, University of Central Florida
Abstract / Description
This dissertation consists of three studies investigating the relationship between business analytics and decision making in accounting. In an effort to improve performance, organizations increasingly emphasize fact-based decision making supported by business analytics, which translate complex data into manageable information through statistical analysis. While the recent focus on business analytics is transforming how managers make decisions, analytics alone do not generate increased...
Show moreThis dissertation consists of three studies investigating the relationship between business analytics and decision making in accounting. In an effort to improve performance, organizations increasingly emphasize fact-based decision making supported by business analytics, which translate complex data into manageable information through statistical analysis. While the recent focus on business analytics is transforming how managers make decisions, analytics alone do not generate increased performance; the synergy between business analytics and user judgments is a vital component of realizing value. To this end, Study I experimentally investigates how various characteristics of business analytics affect individuals' reliance and perceptions of the analytic. Through the lens of cognitive fit a 2(&)#215;2 between-subjects experiment is conducted examining business analytics effects of input and process attributes on users' reliance. Cognitive fit theory posits that effective problem solving depends on the match between the technology and the decision process. The second study investigates the impact of management interventions (i.e. actions influencing adoption) toward improving reliance on business analytics. From an organizational perspective, an important concern for management is promoting greater employee acceptance and utilization of business analytics. Building on the Technology Acceptance Model, Study II experimentally examines the effect of management support and consensus of multiple analytics on increasing reliance and on participants' evaluation of the business analytic. Study III further explores the relationship between characteristics of business analytics and the decision maker by developing a theoretical model regarding the effects of perceived decision similarities between the user and the business analytic on users' perceived usefulness. Overall, the results reported in this dissertation suggest that 1) characteristics of business analytics influence users' judgments and decision making, 2) management can take actions to influence the relationship between users and business analytics, and 3) users are likely to evaluate their cognitive similarity to these business analytics, and these perceptions influence perceived usefulness of the business analytics.
Show less
Date Issued
2018
Identifier
CFE0007578, ucf:52562
Format
Document (PDF)
PURL
http://purl.flvc.org/ucf/fd/CFE0007578
More Than Money: Corporate Social Performance and Reporting and the Effect on Economic Performance
Title
More Than Money: Corporate Social Performance and Reporting and the Effect on Economic Performance.
Creator
Zahller, Kimberly, Roberts, Robin, Arnold, Vicky, Trompeter, Gregory, Folger, Robert, University of Central Florida
Abstract / Description
The three studies in this dissertation explore the relationship between Corporate Social Responsibility (CSR) and Corporate Financial Performance (CFP). CSR consists of social, ethical, and environmental performance dimensions that have not traditionally appeared in mandated financial reports and largely reflect societal expectations for corporate behavior beyond legal and regulatory constraints. CSR is reflected in both corporate actions (performance outcomes) and voluntary reporting ...
Show moreThe three studies in this dissertation explore the relationship between Corporate Social Responsibility (CSR) and Corporate Financial Performance (CFP). CSR consists of social, ethical, and environmental performance dimensions that have not traditionally appeared in mandated financial reports and largely reflect societal expectations for corporate behavior beyond legal and regulatory constraints. CSR is reflected in both corporate actions (performance outcomes) and voluntary reporting (disclosure), and the two are not necessarily equivalent due to managerial discretion in disclosure. Although the mechanisms remain unclear, the general consensus is that there is a positive relationship between CSR and CFP. In considering the drivers and goals of CSR, two themes emerge and are used to inform these papers: a stakeholder view of organizational relationships and the need to signal legitimacy in the face of changing social norms. A stakeholder view asserts that a wide range of groups across society are important to the long-term success and health of the organization. Legitimacy theory provides the explanation of why the stakeholder view is important to organizational success and can produce significant strategic advantages. The first study utilizes archival data in an exploration of how to model the relationship between Corporate Social Performance (CSP) and CFP. Using independent evaluations of organizational CSP from KLD STATS, I explore the CSP-CFP relationship at four different levels (overall CSP, component CSP, directional component CSP, and issue-based component CSP). I consider the effect of CSP on a range of outcome measures of CFP performance, at different levels of aggregated performance measures and linkage to stakeholder groups. Finally, I explore the pattern of significant CSP components on individual CFP outcome measures to determine if there is evidence for changing associations based on relevant stakeholder groups, in answer to concerns raised by prior research (Wood and Jones 1995; Orlitzky, Schmidt, and Rynes 2003). I find that (a) stock market measures are extremely insensitive to CSP; (b) the appropriate measurement level of CSP varies with the degree to which the CFP measure is aggregated and attributable to a more focused group of stakeholders; and (c) significant CSP aspects and associated CFP outcomes do vary in patterns and sensitivity. The second study examines the role voluntary social disclosure plays in economic performance through an attribute I term resilience. Resilience influences stakeholder resource allocation decisions in the face of unexpected poor performance attributable to an exogenous shock and is associated with perceived organizational legitimacy. To test this model, an experiment is conducted in which participants are asked to assess the perceived legitimacy of an organization based on information characteristics of voluntary CSR disclosure and then to make reallocation decisions in the face of poor performance caused by an industry crisis not involving the underlying organization. I find that high quality disclosure (driven by reporting accuracy) is significantly associated with greater perceived legitimacy. In turn, the legitimacy construct is significantly associated with resilience following an exogenous shock. The final study considers organizational choices in CSR disclosure to preserve credibility in the face of a crisis threatening the legitimacy of the institutional framework. Using qualitative data surrounding the turbulent 2001 (-) 2002 period encompassing the Enron and WorldCom scandals and the fall of Andersen, I examine organizational voluntary disclosure decisions to ascertain how they sought to preserve their own informational credibility and legitimacy in the face of a threat that did not directly involve their actions. I find that organizations responded throughout this period by increasing signals of both transparency (greater CSR disclosure) and credibility (greater use of external sources of assurance of that disclosure). I also find that third-party assurance was not widely used, and remained at a steady, minimal percentage over time. Overwhelmingly, organizations turned to the implementation of an independent, external reporting framework (e.g., the Global Reporting Initiative's widespread guidelines) that provided consistency and comparability in their reporting, made use of standardized measurements and definitions, and required specific items and measures.
Show less
Date Issued
2012
Identifier
CFE0004465, ucf:49328
Format
Document (PDF)
PURL
http://purl.flvc.org/ucf/fd/CFE0004465
An Examination of Issues Related to Professional Skepticism in Auditing
Title
An Examination of Issues Related to Professional Skepticism in Auditing.
Creator
Nickell, Erin, Trompeter, Gregory, Arnold, Vicky, Roberts, Robin, Cohen, Jeffrey, University of Central Florida
Abstract / Description
The third general standard of fieldwork requires auditors to maintain a skeptical mindset with regards to the collection and critical assessment of audit evidence. While professional skepticism is frequently referenced by professional standards, a lack of precision in defining the concept presumably leads to variation in how skepticism is exercised in practice. Drawing on theories from the fields of psychology, economics and organizational justice, this dissertation considers different...
Show moreThe third general standard of fieldwork requires auditors to maintain a skeptical mindset with regards to the collection and critical assessment of audit evidence. While professional skepticism is frequently referenced by professional standards, a lack of precision in defining the concept presumably leads to variation in how skepticism is exercised in practice. Drawing on theories from the fields of psychology, economics and organizational justice, this dissertation considers different perspectives of what constitutes sufficient professional skepticism and examines how those perspectives differ between audit practitioners and regulators.First, I consider competing perspectives of professional skepticism (-) neutral versus presumptive doubt (-) and whether asking auditors to adopt alternative perspectives of skepticism may have implications for audit efficiency and effectiveness. While, too little skepticism may endanger audit effectiveness and lead to audit failure or enforcement action, too much skepticism may arguably lead to unnecessary costs and inefficiency.Second, I consider whether the nature of the auditor-client relationship threatens an auditor's ability to maintain an attitude of professional skepticism. For example, theoretical perspectives from the fields of psychology and economics suggest that auditors may, consciously or unconsciously, be less skeptical of clients with whom they have developed close, positive working relationships or financial dependencies. More specifically, I consider whether skeptical behavior is impeded by management who display low-risk attitudes towards fraud or by client's who are considered to be highly important to the profitability of the local office.Finally, I examine how professional skepticism is defined from a regulator's perspective. When a public company is accused of fraudulent financial reporting, regulators may determinethat the audit performed on the fraudulent financial statements was deficient. Prior research has suggested that in such cases, insufficient skepticism is often a leading cause of alleged audit failure. Within a fairness theory framework, this study examines enforcement actions against auditors between 1999 and 2009, and identifies certain factors that are associated with a citation for a lack of professional skepticism. Overall, results suggest that regulators approach the issue by determining whether auditors should have been more skeptical. Factors found to affect this determination include whether the auditor was perceived as having been aware of an elevated risk of fraud or whether the client was accused of having provided the auditor with false or misleading information during the course of their investigation.
Show less
Date Issued
2012
Identifier
CFE0004417, ucf:49385
Format
Document (PDF)
PURL
http://purl.flvc.org/ucf/fd/CFE0004417
Under-Researched Areas of Audit Quality: Inputs, Firms, and Institutions
Title
Under-Researched Areas of Audit Quality: Inputs, Firms, and Institutions.
Creator
Eutsler, Jared, Trompeter, Gregory, Roberts, Robin, Robb, Sean, Krishnamoorthy, Ganesh, University of Central Florida
Abstract / Description
Francis (2011) lists three under-researched units of analysis that affect audit quality: inputs, firms, and institutions. This dissertation analyzes how each of these units of analysis contributes to audit quality. Study 1 examines audit inputs, specifically, characteristics of the individual auditor that affect professional skepticism. Study 2 examines how firm staffing decisions affect audit quality. Study 3 examines how the Public Company Accounting Oversight Board ((")PCAOB(")), as a...
Show moreFrancis (2011) lists three under-researched units of analysis that affect audit quality: inputs, firms, and institutions. This dissertation analyzes how each of these units of analysis contributes to audit quality. Study 1 examines audit inputs, specifically, characteristics of the individual auditor that affect professional skepticism. Study 2 examines how firm staffing decisions affect audit quality. Study 3 examines how the Public Company Accounting Oversight Board ((")PCAOB(")), as a regulatory institution, promotes audit quality through their risk-based inspection program. The first study reports the results of two experiments that examine professional skepticism as a function of moral agency. Consistent with the theory of moral disengagement (through moral agency), the results suggest that common audit firm human resource practices used to promote audit quality (i.e. hiring creative individuals, and advertising public accounting's role as protecting the capital markets) may unintentionally decrease professional skepticism through increasing moral disengagement. Results of Experiment 1 demonstrate creative auditors are more skeptical. However, they are also more prone to engage in less skeptical behavior as they fabricate more creative moral justifications (a specific method of moral disengagement) when working under time pressure. Further, Experiment 2 suggests that moral disengagement is increased when firms frame their public interest responsibilities as protecting the 'capital markets.' The use of this label unintentionally dehumanizes the individuals that make up the public, and as a result, it decreases professional skepticism. Alternatively, altering the frame of the public interest responsibilities to protecting individuals (such as more familiar individual investors) increases humanization and increases professional skepticism. The second study examines how firms affect audit quality. Audit regulators view audit firm staffing as key input affecting audit quality and have suggested that it has value as a potential indicator of audit quality. Further, regulators (such as the IAASB) have called for audit firms to avoid cutting staff (including in periods of economic contraction), as reductions in staff could have a negative impact on audit quality. However, little empirical evidence exists to support how firm-level staffing maps into engagement-level audit quality. This study evaluates the extent to which firm-level staffing affects audit quality. Audit firm employment is obtained from the 1991-2014 rankings of the top 100 U.S. public accounting firms and analyzed across multiple measures of audit quality. In multivariate tests, firm staffing (such as number of partners) and firm leverage (as measured by total partners divided by total professional staff) are associated with audit quality. This analysis provides support for claims made by regulators, about the value of potential labor related audit quality indicators proposed by the PCAOB. Further, decreases in partners or staff (from year to year) are negatively associated with audit quality supporting regulatory claims that audit firm staff cuts have a detrimental impact on audit quality. The third study examines the relationship between the PCAOB, as an institution, and audit quality. The PCAOB uses a risk-based selection process to identify engagements for inspection and states that their inspection findings are an indicator of audit quality. However, critics argue that the risk-based selection program produces reports that are not representative of the overall audit quality for the firm. This study creates a selection model, investigates the extent to which inspection findings are representative of overall firm audit quality, and examines the extent to which the inspection process may improve audit quality. Inspection reports of annually inspected firms from 2004 to 2012 are analyzed in combination with the financials of their issuer clients. Results suggest that inspection report findings can be generalized to the audit quality of those deficient accounts for the issuer client base exhibiting the highest levels of selection risk. Specifically, when audit firms have increased levels of revenue related to inspection deficiencies, their high selection risk clients have higher average discretionary revenues for the year inspected. Further, the analysis suggests that the PCAOB risk-based inspection process is effective in improving audit quality of deficient accounts for clients exhibiting the highest levels of selection risk in the subsequent year. The results indicate a negative association between prior levels of revenue specific inspection deficiencies and future levels of discretionary revenues for high selection risk clients.
Show less
Date Issued
2016
Identifier
CFE0006297, ucf:51590
Format
Document (PDF)
PURL
http://purl.flvc.org/ucf/fd/CFE0006297
Regulation and the Auditing Profession
Title
Regulation and the Auditing Profession.
Creator
Lubimov, Alexei, Trompeter, Gregory, Roberts, Robin, Robb, Sean, Soo, Billy, University of Central Florida
Abstract / Description
The dissertation consists of three studies examining three different regulatory issues that affect the auditing profession. The first study has two main foci. First, the study investigates the impact of Sarbanes-Oxley Act (SOX) on the Big 4 fee premium. Second, the study investigates the relationship between the size of an audit client and annual fee change. The results show that in the post-SOX environment, clients of non-Big 4 firms have experienced greater increases in audit fees than the...
Show moreThe dissertation consists of three studies examining three different regulatory issues that affect the auditing profession. The first study has two main foci. First, the study investigates the impact of Sarbanes-Oxley Act (SOX) on the Big 4 fee premium. Second, the study investigates the relationship between the size of an audit client and annual fee change. The results show that in the post-SOX environment, clients of non-Big 4 firms have experienced greater increases in audit fees than the clients of the Big 4 firms, resulting in a diminishing Big 4 premium. This is consistent with the notion that non-Big 4 clients had to make significant adjustments to meet post-SOX quality requirements by increasing their effort (and consequently audit fees). The results also show audit firms' large clients experience the largest percentage increase in audit fees. This is consistent with the theoretical view of consumer surplus, where the large clients, with more resources, have greater levels of consumer surplus, which is being captured by the audit firms. The study contributes to our understanding of the impact of SOX on audit fee premium and the economics of audit market competition in different client segments. The second study is focused on three main areas: 1) the relationship between audit fees and audit market concentration on a country level; 2) the effect of a country's litigation regime on the relationship between audit fees and market concentration and 3) the inter-relations between competition, fees, and quality in the market for audit services. The study is motivated by the current debate in the United States and the European Union about the possible problems associated with the current oligopolistic structure of the audit market. The contribution of this study lies in the fact that it provides a multi-national empirical investigation of the audit competition-fee relationship, and examination of how country-level fees affect the competition-quality relationship, while controlling for country level factors. Results show a negative relationship between country-level market concentration and audit fees but only in highly litigious countries, suggesting that the firms are able to obtain economies of scale in more concentrated markets and are willing to pass savings down to their clients. However this relationship only holds for the clients of the Big N firms. Analysis of audit quality suggests that audit quality is higher in more concentrated markets but mediation analysis did not show that the fees mediate the relationship between audit quality and market concentration. The third study addresses current regulatory debate about the responsibility of the principal auditor in the group audit environment. Current United States standards allow the principal auditor to disavow responsibility for parts of the audit which were performed by a third party auditor by referencing them in the auditor's opinion and then indicating the part of the audit which was performed by them. This disclaimer of responsibility is prohibited under the international auditing standards, which require the principal auditor to be responsible for the entire group audit. Specifically, this study examines 1) audit quality implications related to such opinions, and 2) the relationship between having a shared opinion and audit fees. The results show that the audit quality is significantly lower for the firms whose audit opinion referenced a third party auditor. The results also provide some evidence that audit fees are lower in shared responsibility situations.
Show less
Date Issued
2013
Identifier
CFE0004882, ucf:49650
Format
Document (PDF)
PURL
http://purl.flvc.org/ucf/fd/CFE0004882