Rejected but Not Dejected: The Effects of Gratitude and Ingroup Membership on Auditors’ Future Advice-Giving when Past Advice is Dismissed

• In Event: Auditor Advice, Skepticism, and Liability

Abstract

Auditors are encouraged to share advice to improve audit quality, but it is inevitable that sometimes this advice will be ignored. Previous research has shown that advice rejection has adverse effects. This paper examines how advice rejection influences auditor’s intentions to provide advice in the future, with a focus on identifying mitigating factors that reduce the impact of rejection. We predict and find in an experiment that expressions of gratitude will reduce the effects of advice rejection, but only when the advisor belongs to the same ingroup as the advisee. Our results provide valuable information for researchers about boundary conditions on the effect of gratitude in the advice domain, and suggest that auditors could emphasize expressions of gratitude to encourage advice sharing amongst team members with a closer group bond.

Authors

• Tim D Bauer, University of Waterloo

• Tim Brown, University of South Carolina