Time budget pressure, auditors' personality type, and the incidence of reduced audit quality practices

Abstract

Purpose

This paper aims to extend the literature on reduced audit quality practices (RAQPs) by examining the relationship between time budget pressure, auditors' personality types, and the incidence of two RAQPs – premature sign‐off of an audit step (PSO) and accepting a weak client explanation (WCE).

Design/methodology/approach

The aim of this paper is to collect data. A research instrument was developed and administered to audit practitioners in New Zealand using postal and web link methods. The research instrument included several hypothetical audit scenarios and Blumenthal's Type A Self‐Rating Inventory Scale (TASRI).

Findings

The paper finds that a significant relationship is present between time budget pressure and PSO only. Significant relationships are also found among auditors' personality types and the incidence of the two RAQPs. These results suggest that the audit environment is complex and that time budget pressure is only one of several explanations for the incidence of RAQPs.

Research limitations/implications

The research instrument of this paper has not been used before in its entirety. This may raise issues of validity of the findings. Also, defining and measuring time budget pressure in terms of two categories (high/low) as opposed to a continuum may have implications on results reported in this study.

Originality/value

The paper provides results that show the importance of auditors' personality type in understanding more about the incidence of RAQPs.

Citation

Gundry, L.C. and Liyanarachchi, G.A. (2007), "Time budget pressure, auditors' personality type, and the incidence of reduced audit quality practices", Pacific Accounting Review, Vol. 19 No. 2, pp. 125-152. https://doi.org/10.1108/01140580710819898