TY - JOUR
T1 - The effects of independent expert recommendations on juror judgments of auditor negligence
AU - Grenier, Jonathan H.
AU - Lowe, David
AU - Reffett, Andrew
AU - Warne, Rick C.
N1 - Publisher Copyright:
© 2015, American Accounting Association. All rights reserved.
PY - 2015/11
Y1 - 2015/11
N2 - Audit firms claim that they are subject to unreasonable litigation risk and that legal reforms are needed. One frequently proposed reform is to utilize independent (i.e., court-appointed) experts to examine case facts and provide recommendations to the court. This study provides theory and evidence to examine the general effects of such recommendations on jurors’ judgments and, also, more specifically, to inform critics’ concerns that jurors will merely “rubber stamp” independent experts’ recommendations. Results of an experiment indicate that independent experts’ recommendations shift jurors’ judgments in the direction of the recommendation, but that such effects depend on jurors’ perceptions of the experts’ credibility. Further, consistent with critics’ concerns, independent experts’ recommendations reduce jurors’ sensitivity to specific case facts in some, but not all, contexts. Specifically, when the experts conclude that the auditors were negligent, jurors’ negligence judgments are insensitive to variation in specific case facts (the auditors’ use versus nonuse of a specialist), but are sensitive to such variation when the experts conclude that the auditors were not negligent. Implications for theory, practice, and regulation are discussed.
AB - Audit firms claim that they are subject to unreasonable litigation risk and that legal reforms are needed. One frequently proposed reform is to utilize independent (i.e., court-appointed) experts to examine case facts and provide recommendations to the court. This study provides theory and evidence to examine the general effects of such recommendations on jurors’ judgments and, also, more specifically, to inform critics’ concerns that jurors will merely “rubber stamp” independent experts’ recommendations. Results of an experiment indicate that independent experts’ recommendations shift jurors’ judgments in the direction of the recommendation, but that such effects depend on jurors’ perceptions of the experts’ credibility. Further, consistent with critics’ concerns, independent experts’ recommendations reduce jurors’ sensitivity to specific case facts in some, but not all, contexts. Specifically, when the experts conclude that the auditors were negligent, jurors’ negligence judgments are insensitive to variation in specific case facts (the auditors’ use versus nonuse of a specialist), but are sensitive to such variation when the experts conclude that the auditors were not negligent. Implications for theory, practice, and regulation are discussed.
KW - Auditor litigation
KW - Auditor negligence
KW - Expert recommendations
KW - Nonmeritorious judgments
UR - http://www.scopus.com/inward/record.url?scp=84947428993&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=84947428993&partnerID=8YFLogxK
U2 - 10.2308/ajpt-51064
DO - 10.2308/ajpt-51064
M3 - Article
AN - SCOPUS:84947428993
SN - 0278-0380
VL - 34
SP - 157
EP - 170
JO - Auditing
JF - Auditing
IS - 4
ER -