Auditor independence and client economic power: qualitative evidence and propositions involving auditors' emotions and moral reasoning

Windsor, Carolyn and Kavanagh, Marie (2012) Auditor independence and client economic power: qualitative evidence and propositions involving auditors' emotions and moral reasoning. In: 2012 Accounting & Finance Association of Australia and New Zealand Conference (AFAANZ 2012), 1-3 July 2012, Melbourne, Australia.

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This study views auditor independence decision-making as holistic, complex and interpersonal, where human elements including emotions come into play when challenged by a morally intense situation. The idea of emotions affecting auditor independence judgments has had little attention in auditing research. In fact, rationality and emotions cannot be separated because they are part of the human condition, often complimenting each other in decision making. To reflect this view, our interactionist model of auditors’ complex decision making includes Rest’s four-component model, (1) moral sensitivity, (2) moral reasoning, and (3) moral motivation as decision-making processes culminating in moral behavior that denotes (4) moral character. We propose that client management economic pressure is a situation of high moral intensity that sensitizes auditors’ emotions and thus motivates their moral reasoning to make deliberative decisions either to resist (a moral judgment) or accede to client management wishes, showing principled, accommodating or pragmatic character.

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Item Type: Conference or Workshop Item (Commonwealth Reporting Category E) (Paper)
Refereed: Yes
Item Status: Live Archive
Additional Information: Paper no. 83. Authors retain copyright.
Faculty/School / Institute/Centre: Historic - Faculty of Business and Law - School of Accounting, Economics and Finance
Date Deposited: 12 Aug 2012 00:53
Last Modified: 16 Apr 2018 05:34
Uncontrolled Keywords: auditing; independence; ethical behaviour
Fields of Research : 15 Commerce, Management, Tourism and Services > 1503 Business and Management > 150311 Organisational Behaviour
15 Commerce, Management, Tourism and Services > 1501 Accounting, Auditing and Accountability > 150102 Auditing and Accountability
22 Philosophy and Religious Studies > 2201 Applied Ethics > 220107 Professional Ethics (incl. police and research ethics)
Socio-Economic Objective: E Expanding Knowledge > 97 Expanding Knowledge > 970115 Expanding Knowledge in Commerce, Management, Tourism and Services

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