Ethical Dilemmas in Auditing: Dishonesty or Unintentional Bias?

Andrés Guiral, Waymond Rodgers, Emiliano Ruiz, José A. Gonzalo

Research output: Contribution to journalArticle

15 Citations (Scopus)


Moral Seduction Theory suggests that auditors are morally compromised by the perceived consequences of their opinions. The root of the auditing problem appears to result in an unintentional bias rather than in dishonesty. Although important accounting reforms have been taken to deal with auditors' trustworthiness, their lack of independence has not been adequately addressed. The new regulation (Sarbanes-Oxley Act) is a consequence of an incorrect understanding of the main true source of auditor's biases. We have developed a cognitive approach by connecting the Throughput Model (TM) to the Moral Seduction Theory. This approach allows a better understanding of how conflicts of interest lead auditors to avoid the issuance of warning signals to stakeholders. We have tested our model by conducting a hypothetical scenario with eighty experienced auditors from international accounting firms. Our results confirm auditors' unintentional reluctance to issue qualified audit opinions alerting investors due to their fear of precipitating clients' final bankruptcy. The main implication is that, more than a regulation, effort should be made in monitoring those conflicts of interest to reduce unintentional bias.

Original languageEnglish
Pages (from-to)151-166
Number of pages16
JournalJournal of Business Ethics
Issue numberSUPPL. 1
Publication statusPublished - 2010 Aug 9

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Business, Management and Accounting(all)
  • Arts and Humanities (miscellaneous)
  • Economics and Econometrics
  • Law

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