Job Complexity and Cognitive Aging: What Can We Learn from Accounting Practice?

42 Pages Posted: 28 Aug 2017

See all articles by Leonardo Barcellos

Leonardo Barcellos

Emory University, Goizueta Business School, Students

Ricardo Lopes Cardoso

Brazilian School of Public and Business Administration; Rio de Janeiro State Univ., FAF

Andre C. B. Aquino

University of Sao Paulo - FEARP-USP

Date Written: August 25, 2017

Abstract

We use a quasi-experimental approach to investigate whether auditing practice is more likely to prevent cognitive reflection abilities (CR-abilities) decline than financial reports elaboration practice. Cognitive aging studies suggest that working in complex and mentally demanding jobs is associated with a slower cognitive decline with aging. We rely on the institutionally unique setting of the Brazilian accounting profession together with previous research and interviews to reason that, while auditors and preparers follow indistinguishable educational paths, auditors usually engage in more cognitively taxing tasks than preparers. From this, we hypothesize and find that auditors’ and preparers’ CR-abilities don’t differ at early career stages, but preparers’ CR-abilities decline across aging, whereas auditors’ CR-abilities are preserved. To assess certified public accountants’ (CPAs) CR-abilities, we collect responses to the cognitive reflection test via a national survey applied by the Brazilian Institute of CPAs. To estimate the moderation effect of career on the relationship between aging and CR-abilities, we explore the unique counterfactual opportunity provided by the accounting setting by matching preparers to auditors within age subgroups. This as good as random approach across several personal and professional individual characteristics allows us to avoid some of the pitfalls of longitudinal studies to provide evidence that aging leads human beings to adapt information processing strategies towards Type 1 processing in detriment of Type 2. But auditing practice may curb this trend. We discuss implications of these findings to accounting research and practice.

Keywords: accounting practice, cognitive aging, cognitive reflection ability, certified public accountants

JEL Classification: M41, M42, M49

Suggested Citation

Barcellos, Leonardo and Cardoso, Ricardo Lopes and Aquino, Andre C. B., Job Complexity and Cognitive Aging: What Can We Learn from Accounting Practice? (August 25, 2017). Available at SSRN: https://ssrn.com/abstract=3026189 or http://dx.doi.org/10.2139/ssrn.3026189

Leonardo Barcellos (Contact Author)

Emory University, Goizueta Business School, Students ( email )

1300 Clifton Road
Atlanta, GA 30322-2722
United States

Ricardo Lopes Cardoso

Brazilian School of Public and Business Administration ( email )

Rua Jornalista Orlando Dantas, 30
Office 206. Botafogo
Rio de Janeiro, Rio de Janeiro 22231-010
Brazil
+55-21 30832713 (Phone)

Rio de Janeiro State Univ., FAF ( email )

Rua Sao Francisco Xavier, 524
bloco B, sala 1024
Rio de Janeiro, Rio de Janeiro
Brazil

Andre C. B. Aquino

University of Sao Paulo - FEARP-USP ( email )

Av. Bandeirantes, 3900 - Monte Alegre
Ribeião Preto, 14040-900
Brazil
55 16 3602-4972 (Phone)

HOME PAGE: http://www.fearp.usp.br

Register to save articles to
your library

Register

Paper statistics

Downloads
26
Abstract Views
584
PlumX Metrics