Journal of
Accounting and Taxation

  • Abbreviation: J. Account. Taxation
  • Language: English
  • ISSN: 2141-6664
  • DOI: 10.5897/JAT
  • Start Year: 2009
  • Published Articles: 196

Full Length Research Paper

Analytical procedures decision aids for generating explanations: Current state of theoretical development and implications of their use

John Anderson
  • John Anderson
  • San Diego State University, United States.
  • Google Scholar
Damon Fleming*
  • Damon Fleming*
  • San Diego State University, United States.
  • Google Scholar

  •  Received: 25 May 2016
  •  Accepted: 15 August 2016
  •  Published: 31 October 2016


The use of decision aids could potentially improve auditor’s decision making by assuring that the correct hypothesis is available for the auditor to consider when employing analytical procedures.  Previous research has shown that auditors have limited ability to generate error explanations on their own.  The purpose of this study is to synthesize the literature for the development of decision aids for generating explanations for analytical procedures, and validate an important finding of the literature, in light of criticism that a previously found effect may be due to a potential flaw in the experimental design.  As predicted by interference theory and availability theory, the results confirm that the proportion of error vs. non-error explanations in the design of the decision aid can significantly impact the auditor’s assessment of the likelihood that the cause of a ratio fluctuation is due to error or irregularity, with implications on audit effectiveness.

Key words: Analytical procedures, decision aid, audit judgment.