The effects of trust, client importance, and goal commitment on auditors' acceptance of client-preferred methods

The purpose of this study is to extend our understanding of the factors that impact auditor judgment and decision-making. Specifically, we investigate how two factors, client importance and auditor trust, impact auditors' directional goal commitment and decision-making at the transaction level. We find no impact of client importance on the auditors' goal commitment or acceptance of a client preferred accounting treatment. However, we find that trust in client's management is positively related to the commitment to the goal of supporting the client's preferred method of recognizing revenue. Further, we find that auditors' goal commitment is positively related to their acceptance of a client preferred accounting treatment.