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This paper illustrates two formulas for assessing independence risk based on the Bayesian and belief-functions frameworks. These formulas can be used to assess the role of threats to auditor independence as well as the role of threat-mitigating safeguards. Also, these formulas provide a basis for evaluation of an audit firm's independence risk and a(More)
Recent events in the auditing profession [sometimes called the 'accounting' profession] have clearly called for a reconsideration of the paradigms currently in vogue in both auditing research and practice. Although early audit research and standard setting explored more rigorous frameworks for risk assessment such as a specific algebraic definition of audit(More)
The concept of a " Fraud Triangle " is introduced to the professional literature in SAS No. 99, Consideration of Fraud in a Financial Statement Audit. The Fraud Triangle consists of three conditions generally present when fraud occurs: Incentive/Pressure, Opportunity, and Attitude/ Rationalizations. Input from forensic experts, academics and others(More)
Acknowledgements: We wish to thank the cooperating firms for their useful comments on the case materials and for providing the subjects for the pilot testing and for the experiment. Raj Srivastava provided important suggestions, especially on the experimental materials and design. Useful comments and suggestions were also obtained ABSTRACT This experimental(More)
Although the published literature on auditor independence is extensive, an accepted comprehensive theory, framework or model of auditor independence risk does not exist. This paper develops a formal model of auditor independence risk that may be used to begin a more rigorous investigation of auditor independence and various factors that are thought to(More)
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