The reduction of dysfunctional audit practices through the amplification of ethical obligation

Audit research indicates that audit quality is being threatened by dysfunctional audit behaviors which are sometimes practiced by auditors in the conduct of their audit work. Dysfunctional audit behaviors include auditors' acts which directly or indirectly lead to reduced audit quality. This study focused on two of these dysfunctional audit behaviors, underreporting of time (URT) and premature signoff (PMSO). These two behaviors are not only dysfunctional but also unethical, since both involve falsification of reports and violation of both professional audit standards and firm audit policies (Buchman and Tracy 1982; Arens and Loebbecke 1994).; The research question addressed was; will the reinforcement of ethical obligation through the expectation of signing a pledge that the work has been performed ethically reduce URT and/or PMSO? Two hypotheses were developed and tested. The first hypothesized a positive relationship between time pressure and the two dysfunctional behaviors. The second hypothesis examined if a subject expectation of signing a post-task ethical promise moderated this relationship. Eighty two (82) graduate and undergraduate accounting students participated in an experimental study where two variables, time pressure and the expectation of making the ethical promise, were manipulated. The first hypothesis was supported. Results indicated a positive relationship between time pressure and both URT and PMSO. The second hypothesis was not supported. The ethical promise expectation did not moderate the incidence of either URT or PMSO in the face of time pressure. A discussion and limitations of the study are offered.