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The effect of brainstorming guidelines on individual auditors’ identification of potential frauds

Author

Listed:
  • Wei Chen

    (School of Accounting, UNSW Business School, UNSW Sydney, Kensington, NSW, Australia)

  • Amna Saeed Khalifa

    (Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, Islamabad, Pakistan)

  • Kate L Morgan
  • Ken T Trotman

Abstract

Revised auditing standards and a focus by regulators on the detection of financial statement fraud have resulted in calls for research to examine alternative forms of fraud brainstorming. We examine the effect of using extended brainstorming guidelines, developed in the psychology literature as part of facilitator training, on auditors’ individual brainstorming performance prior to attending the team brainstorming meeting. We find that these additional brainstorming guidelines help auditors identify a greater quantity and quality of potential frauds. Our findings suggest an easy to implement approach to enhance auditors’ performance in fraud brainstorming. JEL Classification: C91; C92; M42

Suggested Citation

  • Wei Chen & Amna Saeed Khalifa & Kate L Morgan & Ken T Trotman, 2018. "The effect of brainstorming guidelines on individual auditors’ identification of potential frauds," Australian Journal of Management, Australian School of Business, vol. 43(2), pages 225-240, May.
    • Handle: RePEc:sae:ausman:v:43:y:2018:i:2:p:225-240
    DOI: 10.1177/0312896217728560
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    References listed on IDEAS

    as
    1. Ken T. Trotman & Roger Simnett & Amna Khalifa, 2009. "Impact of the Type of Audit Team Discussions on Auditors' Generation of Material Frauds," Contemporary Accounting Research, John Wiley & Sons, vol. 26(4), pages 1115-1142, December.
    2. Trotman, Ken T. & Bauer, Tim D. & Humphreys, Kerry A., 2015. "Group judgment and decision making in auditing: Past and future research," Accounting, Organizations and Society, Elsevier, vol. 47(C), pages 56-72.
    3. Peecher, Mark E. & Solomon, Ira & Trotman, Ken T., 2013. "An accountability framework for financial statement auditors and related research questions," Accounting, Organizations and Society, Elsevier, vol. 38(8), pages 596-620.
    4. Paul Coram & Colin Ferguson & Robyn Moroney, 2008. "Internal audit, alternative internal audit structures and the level of misappropriation of assets fraud," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 48(4), pages 543-559, December.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Audit planning; brainstorming guidelines; fraud identification; individual brainstorming;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • M42 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Auditing

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