Email this article The impact of expected outcomes on going-concern opinions: the case of auditors, bankers and insolvency
Abstract
The evidence confirms that, auditors', bankers' and insolvency practitioners' expected outcomes
of wrongly classifying a non-viable firm as viable, is more important than the opposite.
However, there is no significant correlation between expected outcomes and individuals' "going-
concern" opinions. Furthermore, individuals' perceived roles, risks, and risk attitudes are related
to their expected outcomes suggesting a subtle impact of behavioural factors on individuals'
decision-making in this context. Finally, a logistic regression model for "going-concern" classifications
using all the aforementioned variables has an overall accuracy of 78.10%.
of wrongly classifying a non-viable firm as viable, is more important than the opposite.
However, there is no significant correlation between expected outcomes and individuals' "going-
concern" opinions. Furthermore, individuals' perceived roles, risks, and risk attitudes are related
to their expected outcomes suggesting a subtle impact of behavioural factors on individuals'
decision-making in this context. Finally, a logistic regression model for "going-concern" classifications
using all the aforementioned variables has an overall accuracy of 78.10%.
Keywords
Auditors; Bankers; Going concern (Accounting); Risk; Auditing
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