The impact of *experience, industry characteristics, and individual differences on audit risk and the extent of testing decisions: An empirical investigation

The first part of the study examined the effect of industry risk changes on perceived audit risk at the financial statement level and whether these changes depended on individual differences such as experience and tolerance for ambiguity. ^ Forty-eight auditors from two offices of one of the “Big 5” CPA firms participated in this study. The ANOVA results supported the effect of industry risk in the assessment of audit risk at the financial statement level. Higher industry risk was associated with higher perceived audit risk. Tolerance for ambiguity was also significant in explaining the changes in the assessment of audit risk. Auditors with a high tolerance for ambiguity perceived lower audit risk than auditors with a low tolerance for ambiguity. Although ANOVA results did not find experience to be significant, a t-test for experience showed it to be marginally significant and inversely related to audit risk. ^ The second part of this study examined whether differences in perceived audit risk at the financial statement level altered the extent, nature or timing of the planned auditing procedures. The results of the MANOVA suggested an overall audit risk effect at the financial statement level. Perceived audit risk was significant in explaining the variation in the number of hours planned for the total cycle and the number of hours p1anned for the tests of balances and details. Perceived audit risk was not significant in determining the analytical review procedures planned, but assessed inherent risk at the cycle level was significant. The higher the inherent risk the more analytical procedures were planned. Perceived audit risk was not significant in explaining the timing of the procedures, but individual differences were significant. The results showed that experienced auditors and those with a high tolerance for ambiguity were less likely to postpone the performance of the interim procedures or the time at which the majority of audit work would be done. ^

Participative Budgeting and Participant Motivation: A Review of the Literature

In their discussion - Participative Budgeting and Participant Motivation: A Review of the Literature - by Frederick J. Demicco, Assistant Professor, School of Hotel, Restaurant and Institutional Management, The Pennsylvania State University and Steven J. Dempsey, Fulton F. Galer, Martin Baker, Graduate Assistants, College of Business at Virginia Polytechnic Institute and State University, the authors initially observe: “In recent years behavioral literature has stressed the importance of participation In goal-setting by those most directly affected by those goals. The common postulate is that greater participation by employees in the various management functions, especially the planning function, will lead to improved motivation, performance, coordination, and functional behavior. The authors analyze this postulate as it relates to the budgeting process and discuss whether or not participative budgeting has a significant positive impact on the motivations of budget participants.” In defining the concept of budgeting, the authors offer: “Budgeting is usually viewed as encompassing the preparation and adoption of a detailed financial operating plan…” In furthering that statement they also furnish that budgeting’s focus is to influence, in a positive way, how managers plan and coordinate the activities of a property in a way that will enhance their own performance. In essence, framing an organization within its described boundaries, and realizing its established goals. The authors will have you know, to control budget is to control operations. What kind of parallels can be drawn between the technical methods and procedures of budgeting, and managerial behavior? “In an effort to answer this question, Ronen and Livingstone have suggested that a fourth objective of budgeting exists, that of motivation,” say the authors with attribution. “The managerial function of motivation is manipulative in nature.” Demicco, Dempsey, Galer, and Baker attempt to quantify motivation as a psychological premise using the expectancy theory, which encompasses empirical support, intuitive appeal, and ease of application to the budgetary process. They also present you with House's Path-Goal model; essentially a mathematics type formula designed to gauge motivation. You really need to see this. The views of Argyris are also explored in particular detail. Although, the Argyris study was primarily aimed at manufacturing firms, and the effects on line-supervisors of the manufacturing budgets which were used to control and evaluate their performance, its application is relevant to the hospitality industry. As the title suggests, other notables in the field of behavioral motivation theory, and participation are also referenced. “Behavioral theory has been moving away from models of purported general applicability toward contingency models that are suited for particular situations,” say the authors in closing. “It is conceivable that some time in the future, contingency models will make possible the tailoring of budget strategies to individual budget holder personalities.”

Operant and respondent procedures to establish social stimuli as reinforcers in children with autism

According to the DSM-IV- TR (American Psychiatric Association, 2000), one of the core deficits in autism is in the impairment of social interaction. Some have suggested that underlying these deficits is the reality that individuals with autism do not find social stimuli to be as reinforcing as other types of stimuli (Dawson, 2008). An interesting and growing body of literature supports the notion that symptoms in autism may be caused by a general reduction in social motivation (Chevallier et al., 2012). A review of the literature suggests that social orienting and social motivation are low in individuals with autism, and including social motivation as a target for therapeutic intervention should be pursued (Helt et al., 2008). Through our understanding of learning processes, researchers in behavior analysis and related fields have been able to use conditioning procedures to change the function of neutral or ineffective stimuli, including tokens (Ayllon & Azrin, 1968), facial expressions (Gewirtz & Pelaez-Nogueras, 1992) and praise (Dozier et al., 2012). The current study aimed to use operant and respondent procedures to condition social stimuli that were empirically shown to not be reinforcing prior to conditioning. Further, this study aimed to compare the two procedures in their effectiveness to condition social stimuli to function as reinforcers, and in their maintenance of effects over time. Using a multiple-baseline, multi-element design, one social stimulus was conditioned under each procedure to compare the different response rates following conditioning. Finally, the study sought to determine if conditioning social stimuli to function as reinforcers had any effect on the social functioning of young children with autism. Six children diagnosed with autism between the ages of 18 months and 3 years participated. Results show that the respondent procedure (pairing) resulted in more robust and enduring effects than the operant procedure (Sd procedure). Results of a social communication assessment (ESCS, Mundy et al., 2003) before and after conditioning demonstrate gains in all areas of social communication, particularly in the areas of initiating and responding to joint attention.^

Operant and Respondent Procedures to Establish Social Stimuli as Reinforcers in Children with Autism

According to the DSM-IV- TR (American Psychiatric Association, 2000), one of the core deficits in autism is in the impairment of social interaction. Some have suggested that underlying these deficits is the reality that individuals with autism do not find social stimuli to be as reinforcing as other types of stimuli (Dawson, 2008). An interesting and growing body of literature supports the notion that symptoms in autism may be caused by a general reduction in social motivation (Chevallier et al., 2012). A review of the literature suggests that social orienting and social motivation are low in individuals with autism, and including social motivation as a target for therapeutic intervention should be pursued (Helt et al., 2008). Through our understanding of learning processes, researchers in behavior analysis and related fields have been able to use conditioning procedures to change the function of neutral or ineffective stimuli, including tokens (Ayllon & Azrin, 1968), facial expressions (Gewirtz & Pelaez-Nogueras, 1992) and praise (Dozier et al., 2012). The current study aimed to use operant and respondent procedures to condition social stimuli that were empirically shown to not be reinforcing prior to conditioning. Further, this study aimed to compare the two procedures in their effectiveness to condition social stimuli to function as reinforcers, and in their maintenance of effects over time. Using a multiple-baseline, multi-element design, one social stimulus was conditioned under each procedure to compare the different response rates following conditioning. Finally, the study sought to determine if conditioning social stimuli to function as reinforcers had any effect on the social functioning of young children with autism. Six children diagnosed with autism between the ages of 18 months and 3 years participated. Results show that the respondent procedure (pairing) resulted in more robust and enduring effects than the operant procedure (Sd procedure). Results of a social communication assessment (ESCS, Mundy et al., 2003) before and after conditioning demonstrate gains in all areas of social communication, particularly in the areas of initiating and responding to joint attention.