Date of Award
1-1-2024
Document Type
Dissertation
Degree Name
Ph.D. in Accountancy
First Advisor
Kendall Bowlin
Second Advisor
Jeff Pickerd
Third Advisor
Christy Nielson
Relational Format
dissertation/thesis
Abstract
Audit regulators are concerned that times of economic uncertainty will likely cause external auditors to misuse the work of the internal audit function (IAF). These concerns are consistent with prior psychology research finding that objective poverty or a subjective, perceived lack of resources induces a scarcity mindset, which then leads to counterproductive economic behaviors. Therefore, I examine the effect of such a scarcity mindset on external auditors’ IAF reliance choices. In an experiment that incorporates a setting mimicking the evidence collection process, I manipulate the external auditor’s scarcity mindset and the internal audit function’s competence. I find that external auditors with a scarcity mindset, as compared to external auditors without a scarcity mindset, are more risk averse, which leads to a lower level of reliance on an IAF perceived as more competent. These findings contradict the concerns from regulators and indicate that, if anything, external auditors are less likely to rely on the IAF in times of economic uncertainty.
Recommended Citation
Patterson, Brett, "The Effect of a Scarcity Mindset on External Auditors' Reliance on the Internal Audit Function" (2024). Electronic Theses and Dissertations. 2856.
https://egrove.olemiss.edu/etd/2856