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The Impact of Perceived Ethical Culture of the Firm and Demographic Variables on Auditors’ Ethical Evaluation and Intention to Act Decisions

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Abstract

This study examined the impact of perceived ethical culture of the firm and selected demographic variables on auditors’ ethical evaluation of, and intention to engage in, various time pressure-induced dysfunctional behaviours. Four audit cases and questionnaires were distributed to experienced pre-manager level auditors in Ireland and the U.S. The findings revealed that while perceived unethical pressure to engage in dysfunctional behaviours and unethical tone at the top were significant in forming an ethical evaluation, only perceived unethical pressure had an impact on intention to engage in the behaviours. Country was also found to have a significant impact, with U.S. respondents reporting higher ethical evaluations and lower intentions to engage in unethical acts than Irish respondents. Implications of the findings and areas for future research are discussed.

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Abbreviations

PSO:

Premature sign-off

URT:

Underreporting of time

QTB:

Quality threatening behaviour

ECQ:

Ethical culture question

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Authors and Affiliations

  1. NUI Galway, Galway, Ireland

    Breda Sweeney

  2. Union Graduate College, Schenectady, USA

    Don Arnold

  3. Dublin City University, Dublin, Ireland

    Bernard Pierce

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  1. Breda Sweeney
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  2. Don Arnold
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  3. Bernard Pierce
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Correspondence to Breda Sweeney.

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Sweeney, B., Arnold, D. & Pierce, B. The Impact of Perceived Ethical Culture of the Firm and Demographic Variables on Auditors’ Ethical Evaluation and Intention to Act Decisions. J Bus Ethics 93, 531–551 (2010). https://doi.org/10.1007/s10551-009-0237-3

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