The Influence of Business-Process-Focused Audit Support Software on Analytical Procedures Judgments

Some large public accounting firms that emphasize the business risk audit methodology revised their audit support software to organize audit evidence around business process rather than transaction cycle. These business-process-focused (BPF) systems present client information grouped by value chain activities, while firms that use traditional transaction-cycle-focused (TCF) audit support software might group client information primarily by account classification. Our study examines whether the presentation differences between BPF and TCF audit support software influence auditors' risk judgment during planning-phase analytical procedures. In a field experiment, experienced audit seniors performed analytical procedures on case materials containing a variety of seeded risk factors. One group completed the exercise using software organized around the BPF while the other group used software organized around the TCF. Participants who used the BPF system identified more of the seeded risk conditions and assessed misstatement risk at higher levels than did their counterparts who used the TCF system. These findings provide the experimental evidence that audit support software organized around business processes can influence decision performance while conducting planning-phase analytical procedures.