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The impact of gender difference on the interpretation of uncertainty expressions

Wenqi Han ( Macquarie University Sydney Australia )
Andreas Hellmann ( Macquarie University Sydney Australia )
Meiting Lu ( Macquarie University Sydney Australia )

Asian Review of Accounting

ISSN: 1321-7348

Article publication date: 18 March 2016

889

Abstract

Purpose

This study conducts an empirical examination of auditors’ interpretation of selected key uncertainty expressions, namely virtually certain, probable and unlikely, included in accounting standards.

Design/methodology/approach

This paper adopts a survey research method to examine the impact of gender difference on the interpretation of uncertainty expressions. Professional auditors in China were selected to examine whether gender difference influences the interpretation of uncertainty expressions.

Findings

The results show that female auditors are likely to interpret positive or negative uncertainty expressions more conservatively than male auditors. The extent of conservatism is higher when female auditors are interpreting in-context expressions. The results remain similar after controlling for additional variables, such as education and work experience, which possibly affect the interpretation of probability expressions.

Originality/value

The results of this study suggest that gender difference can affect the numerical thresholds that auditors’ assign to uncertainty expressions. This may lead to different application of professional judgments between male and female auditors. It also provides important implications to regulators and practitioners on the quality of financial reporting and auditing across organizations within and across countries.

Citation

Han, W., Hellmann, A. and Lu, M. (2016), "The impact of gender difference on the interpretation of uncertainty expressions", Asian Review of Accounting, Vol. 24 No. 2. https://doi.org/10.1108/ARA-06-2014-0073

Publisher

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Emerald Group Publishing Limited

Copyright © 2016, Emerald Group Publishing Limited

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