Quantifying intuitions about risk: Comparing public accounting firm partners perceived as risky and non-risky

Anne E Norris, Deborah Norris, Daven Morrison, Greg Trompeter

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

The purpose of this study is to identify a psychological profile for public accounting firm partners who are likely to place the partnership and client shareholder at risk. Proprietary data from an executive counseling firm provided a unique opportunity to compare two groups of partners: those identified by their senior partners as placing the firm at risk (n1/431) and those not so identified (n1/464). The groups were compared using psychological measures, lifestyle measures, personal measures, and work history variables. Results found no significant measurable difference between the audit partners who were identified as posing a risk and those not so identified. This suggests that specific factors cannot lead a partner to engage in risky behaviors, but rather several, in combination, may be necessary. Implications for research include learning more about concepts such as resistance to temptation, motivation, and rationalization. Implications for practice are to focus on structuring business practices to provide early warning signs and minimize opportunities to engage in risky behavior. Continued and increased diligence in the client screening and client continuation and review process remain essential for best practices.

Original languageEnglish (US)
Title of host publicationAdvances in Accounting Behavioral Research
Pages67-89
Number of pages23
Volume14
DOIs
StatePublished - 2011
Externally publishedYes

Publication series

NameAdvances in Accounting Behavioral Research
Volume14
ISSN (Print)14751488

Fingerprint

Intuition
Public accounting firms
Psychological
Risky behavior
Rationalization
Lifestyle
Audit
Placing
Shareholders
Specific factors
Temptation
Business practices
Early warning
Counseling
Review process
Work history
Best practice
Screening

ASJC Scopus subject areas

  • Accounting
  • Management Science and Operations Research

Cite this

Norris, A. E., Norris, D., Morrison, D., & Trompeter, G. (2011). Quantifying intuitions about risk: Comparing public accounting firm partners perceived as risky and non-risky. In Advances in Accounting Behavioral Research (Vol. 14, pp. 67-89). (Advances in Accounting Behavioral Research; Vol. 14). https://doi.org/10.1108/S1475-1488(2011)0000014006

Quantifying intuitions about risk : Comparing public accounting firm partners perceived as risky and non-risky. / Norris, Anne E; Norris, Deborah; Morrison, Daven; Trompeter, Greg.

Advances in Accounting Behavioral Research. Vol. 14 2011. p. 67-89 (Advances in Accounting Behavioral Research; Vol. 14).

Research output: Chapter in Book/Report/Conference proceedingChapter

Norris, AE, Norris, D, Morrison, D & Trompeter, G 2011, Quantifying intuitions about risk: Comparing public accounting firm partners perceived as risky and non-risky. in Advances in Accounting Behavioral Research. vol. 14, Advances in Accounting Behavioral Research, vol. 14, pp. 67-89. https://doi.org/10.1108/S1475-1488(2011)0000014006
Norris AE, Norris D, Morrison D, Trompeter G. Quantifying intuitions about risk: Comparing public accounting firm partners perceived as risky and non-risky. In Advances in Accounting Behavioral Research. Vol. 14. 2011. p. 67-89. (Advances in Accounting Behavioral Research). https://doi.org/10.1108/S1475-1488(2011)0000014006
Norris, Anne E ; Norris, Deborah ; Morrison, Daven ; Trompeter, Greg. / Quantifying intuitions about risk : Comparing public accounting firm partners perceived as risky and non-risky. Advances in Accounting Behavioral Research. Vol. 14 2011. pp. 67-89 (Advances in Accounting Behavioral Research).
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