Does Higher Status Make Client Personnel More Cooperative with Staff Auditors?

• In Event: Auditor Characteristics

Abstract

Staff auditors sometimes collect evidence from high-status client personnel, and prior research explores how this can harm evidence collection by changing auditor behavior. In the current study, I focus on how holding status changes client behavior. Specifically, I investigate (1) the possibility that status makes clients more cooperative towards staff auditors, and (2) whether auditors’ actions moderate the effect. In an abstract, interactive laboratory experiment, auditors choose how much evidence to collect and clients choose how much to cooperate. Results indicate that high-status clients are more cooperative than low-status clients, but only for smaller evidence requests. Further analysis suggests that high-status clients are more sensitive to increases in request size than low-status clients. Overall, my findings demonstrate that collecting evidence from high-status client personnel may actually benefit auditors, but this effect depends on the auditor’s actions, carrying implications for practitioners that value client cooperation.

Author

• Dan Rimkus, University of Texas at Austin