The Effects of Social Identification and Expert Witness Credibility on Juror Judgments of Auditor Negligence

• In Event: Auditor Litigation

Abstract

This study examines the effects of a juror’s ability to socially identify with a plaintiff in an auditor liability case on their assessments of auditor negligence. Additionally, we examine whether those effects moderate the relation between expert witness credibility and auditor negligence. We conduct an experiment with 316 mock jurors and discover that jurors find auditors more negligent when they are able to socially identify with the plaintiff (i.e., a pension fund) than when they are not able to socially identify (i.e., a bank). Our findings also indicate that jurors are only sensitive to differences in expert witness credibility when they do not identify with the plaintiff. Our results have important implications for the accounting profession and academy, as well as regulators and policymakers, by providing evidence about the impact of plaintiff identity and expert witness credibility on audit litigation outcomes.

Authors

• Duane M Brandon, Auburn University

• Travis P. Holt, Auburn University

• James H. Long, Auburn University

• Jennifer M Mueller-Phillips, Auburn University