TY - JOUR A1 - Smieliauskas, Wally A1 - Bewley, Kathryn A1 - Gronewold, Ulfert A1 - Menzefricke, Ulrich T1 - Misleading Forecasts in Accounting Estimates BT - a Form of Ethical Blindness in Accounting Standards? JF - Journal of business ethics N2 - The current financial reporting environment, with its increasing use of accounting estimates, including fair value estimates, suggests that unethical accounting estimates may be a growing concern. This paper provides explanations and empirical evidence for why some types of accounting estimates in financial reporting may promote a form of ethical blindness. These types of ethical blindness can have an escalating effect that corrupts not only an individual or organization but also the accounting profession and the public interest it serves. Ethical blindness in the standards of professional accountants may be a factor in the extent of misreporting, and may have taken on new urgency as a result of the proposals to change the conceptual framework for financial reporting using international standards. The social consequences for users of financial statements can be huge. The acquittal of former Nortel executives on fraud charges related to accounting manipulations is viewed by many as legitimizing accounting gamesmanship. This decision illustrates that the courts may not be the best place to deal with ethical reporting issues. The courts may be relied on for only the most egregious unethical conduct and, even then, the accounting profession is ill equipped to assist the legal system in prosecuting accounting fraud unless the standards have been clarified. We argue that the problem of unethical reporting should be addressed by the accounting profession itself, preferably as a key part of the conceptual framework that supports accounting and auditing standards, and the codes of ethical conduct that underpin the professionalism of accountants. KW - Ethical accounting estimates KW - Estimation uncertainty KW - IASB accounting conceptual framework KW - Accounting standards KW - Auditing standards Y1 - 2016 U6 - https://doi.org/10.1007/s10551-016-3289-1 SN - 0167-4544 SN - 1573-0697 VL - 152 IS - 2 SP - 437 EP - 457 PB - Springer CY - Dordrecht ER - TY - JOUR A1 - Seckler, Christoph A1 - Gronewold, Ulfert A1 - Reihlen, Markus T1 - An error management perspective on audit quality BT - Toward a multi-level model JF - Accounting, Organizations and Society N2 - We take an error management perspective on audit quality. Drawing on 18 months of participant observations and 38 interviews conducted in a Big 4 accounting firm, we develop a multi-level model of error management. With this model, we propose how organizational structures, team procedures and practices, and individual cognitions and emotions interact to manage errors. The multi-level model of error management allows us to conceptually integrate previous behavioral and social research on audit quality, contributes to the rising accounting firm error management literature, and explains how and why two general approaches from the broader error management literature to errors that are usually considered as opposing each other, i.e., error prevention and error resilience, may interact and actually entail each other in accounting firms. KW - Audit quality KW - Error management KW - Multi-level model Y1 - 2017 U6 - https://doi.org/10.1016/j.aos.2017.08.004 SN - 0361-3682 SN - 1873-6289 VL - 62 SP - 21 EP - 42 PB - Elsevier CY - Oxford ER - TY - JOUR A1 - Gold, Anna A1 - Gronewold, Ulfert A1 - Salterio, Steven E. T1 - Error management in audit firms: error climate, type, and originator JF - The accounting review : a journal of the American Accounting Association KW - error discovery KW - working paper review KW - error reporting KW - error management KW - climate KW - audit quality Y1 - 2014 U6 - https://doi.org/10.2308/accr-50592 SN - 0001-4826 SN - 1558-7967 VL - 89 IS - 1 SP - 303 EP - 330 PB - American Accounting Association CY - Sarasota ER - TY - JOUR A1 - Gronewold, Ulfert A1 - Gold, Anna A1 - Salterio, Steven E. T1 - Reporting Self-Made Errors - The Impact of Organizational Error-Management Climate and Error Type JF - Journal of business ethics N2 - We study how an organization's error-management climate affects organizational members' beliefs about other members' willingness to report errors that they discover when chance of error detection by superiors and others is extremely low. An error-management climate, as a component of the organizational climate, is said to be "high" when errors are accepted as part of everyday life as long as they are learned from and not repeated. Alternatively, the error-management climate is said to be an "error averse" climate when discovery of errors invokes the laying of blame on those admitting to or found committing errors. We examine the effects of this error-management climate in a professional services environment where uncorrected errors may have severe consequences and discovery of work errors is crucial for organizational success. We find that error-management climate affects organizational members' beliefs about what other members will report about discovered self-made errors, with a high error-management (versus error averse) climate leading to greater reporting willingness. We also find a significant interaction with a key contextual variable, error type (conceptual or calculation), that suggests the effect is more significant for conceptual errors than calculation errors. Our findings suggest that an organization's error-management climate is an important factor in promoting ethical behavior of employees, especially junior employees, carrying out routine tasks whose failure to report errors discovered incidental to those tasks may have severe implications for their organizations. KW - Error reporting KW - Self-discovered errors KW - Organizational climate KW - Error-management climate KW - Auditors Y1 - 2013 U6 - https://doi.org/10.1007/s10551-012-1500-6 SN - 0167-4544 SN - 1573-0697 VL - 117 IS - 1 SP - 189 EP - 208 PB - Springer CY - Dordrecht ER - TY - THES A1 - Gronewold, Ulfert T1 - Die Beweiskraft von Beweisen : Audit Evidence bei betriebswirtschaftlichen Prüfungen T2 - Wissenschaftliche Schriften zur Wirtschaftsprüfung Y1 - 2006 SN - 3-8021-1257-1 PB - IDW CY - Düsseldorf ER -