Delivering the 'Tough Message': Moderators of Subordinate Auditors’ Reactions to Feedback

Posted: 26 Mar 2016 Last revised: 24 Mar 2018

See all articles by Lindsay M. Andiola

Lindsay M. Andiola

Virginia Commonwealth University (VCU) - Department of Accounting

Jean C. Bedard

Bentley University - Department of Accountancy

Date Written: February 13, 2018

Abstract

The audit review process is a key quality control mechanism. Recent evidence from practice suggests that regulatory risk has made reviews more critical, and audit supervisors are struggling with how to effectively deliver the “tough message”. We contribute to the audit review literature by providing an in-depth understanding of the subordinate’s perspective, focusing on the understudied topic of negative feedback and factors that might moderate its effects. We investigate these issues using an experiential questionnaire soliciting subordinate auditors’ reactions to highly salient actual review experiences. We find both adverse and beneficial reactions to more negative feedback, including worse attitudes toward coaching relationships, more attempts to manage supervisors’ impressions, but greater performance improvement efforts. These reactions are moderated by the subordinate auditor’s feedback orientation (i.e., receptivity), and sometimes by the supervisor’s goal framing (i.e., emphasis on learning versus performance). Collectively, participants more often chose engagement over workpaper reviews to represent their most salient experiences, and some results differ between these review contexts. Qualitative analysis identifies both similarities and differences in key attributes of these review types. These results are important, as the audit review literature predominately considers workpaper review, and no study compares the two review contexts.

Keywords: Audit review, feedback sign, feedback orientation, goal framing, workpaper review, engagement review

JEL Classification: M4

Suggested Citation

Andiola, Lindsay M. and Bedard, Jean C., Delivering the 'Tough Message': Moderators of Subordinate Auditors’ Reactions to Feedback (February 13, 2018). Accounting, Organizations and Society, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2754133 or http://dx.doi.org/10.2139/ssrn.2754133

Lindsay M. Andiola (Contact Author)

Virginia Commonwealth University (VCU) - Department of Accounting ( email )

Richmond, VA 23284
United States

Jean C. Bedard

Bentley University - Department of Accountancy ( email )

175 Forest Street
Waltham, MA 02452
United States
781-891-2410 (Phone)
781-891-2896 (Fax)

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