How Do Novice Auditors’ Receptivity to Negative Feedback and Reviewer Goal Framing Affect Follow-Through Performance?

Abstract

Research indicates that providing negative feedback can induce adverse responses. This may be problematic in auditing where negative feedback is common during workpaper review and auditors’ follow-through on this feedback is essential to audit quality. Psychology research suggests that individuals’ receptivity to feedback and supervisors’ framing of feedback can impact individuals’ reactions and subsequent performance. Using a 2x2 between-subjects experiment, I examine how novice auditors’ feedback reactions and performance following negative feedback vary with feedback orientation and reviewers’ framing with learning or performance goals. Results show positive reactions only for participants with stronger feedback orientations when learning goals are emphasized, while the follow-through performance of novice auditors is more nuanced. Learning goals appear beneficial to those with weaker feedback orientations. These results contribute to the audit and feedback literature and have practical implications for firms by offering guidance on how reviewers may provide negative feedback to induce good performance.

Keywords: negative feedback, feedback orientation, goal framing, workpaper review, task performance, ghost ticking

JEL Classification: M40, M42