The Effects of Psychological Ownership on Specialists’ Judgments and Communication in Audit Teams

• In Event: DSFI: Part I

Abstract

Audit teams increasingly rely on specialists, yet regulators are concerned auditors and
specialists do not effectively communicate. Auditors express frustration that specialists do not
always proactively communicate with the audit team. We approach this problem from the
specialists’ perspective. In an experiment with MBA students placed in the role of a specialist within
a team, we examine how psychological ownership—the feeling that something is one’s own—
affects these specialists’ judgments and communication with their team leader. We find that
specialists with higher psychological ownership more often identify issues regarding an asset
valuation and more proactively communicate those issues. Moreover, psychological ownership
affects specialists’ responses to subsequent suggestions from the team leader, which vary in
justification strength, suggesting that higher ownership can prevent specialists from being unduly
influenced by the audit team’s preferences. We contribute to research in auditing and psychology by
demonstrating that psychological ownership influences communication choices through its effect on
cognition and judgment. We contribute to auditing research and practice by approaching the issue of
auditors’ inadequate use of specialists’ work through a focus on the behavior of specialists, rather
than auditors.

Author

• Cassandra Ruth Estep, Emory University