Investigating The Partners Of Auditing Institutions Behavioral Biases and it’s effect On Professional Doubt and The Auditors' Opinions Quality In The Framework Of A Mixed Approach

Document Type : Original Article

Authors
Mohammad Golestani rad 1
Mojtaba Maleki Choobari 2
sina kheradyar 3
1 Department of Accounting, Qazvin Branch, Islamic Azad University, Qazvin, Iran
2 Assistant Professor of Accounting Department, Rasht Branch, Islamic Azad University, Rasht, Iran
3 Associate Professor, Department of Accounting, Rasht Branch, Islamic Azad University, Rasht, Iran
10.22034/jmaak.2025.78227.4473
Abstract
the general goal of this research is to model the behavioral patterns of audit institutions' partners. In terms of the purpose of this research, it is a type of applied research from the perspective of the type of qualitative data. The participants of this research are the heads of auditing institutions in Tehran, who were selected and studied by snowball method until theoretical saturation. Data analysis was done in three stages of open coding, central coding and selective coding using MAXQDA software. After the detailed analysis of the interviews, the research findings led to the identification of 74 extracted concepts from 12 main categories. Based on the six dimensions of the paradigmatic model categories, then the categories were placed based on the six dimensions of the paradigmatic model categories (causal conditions, central phenomenon, contextual factors, intervening factors, strategies and consequences) and the final research model was obtained. The paradigm model of research in causal conditions includes 1- individual factors, 2- environmental factors; The categories in the central phenomenon section include 1- managerial factors, 2- communication factors; The categories in the contextual conditions section include 1- organizational factors, 2- individual factors; The categories in the intervening conditions section include 1- organizational factors, 2- environmental factors; The categories in the strategy section include 1- intra-organizational, 2- extra-organizational, and it is expected that with the implementation of these strategies, consequences such as behavioral consequences and anti-effectiveness in auditing institutions will be imagined. At the end, the model of the behavioral biases of the partners of the audit institutions and the effect of the behavioral biases of the audit institutions partners on the auditor's professional doubt and the quality of the auditors' comments were validated using structural equation modeling software, and the validity of the model was estimated at 89.8%.
  1. Adil, M., Singh, Y., and Ansari, M. S. (2022). How financial literacy moderate the association between behaviour biases and investment decision? Asian J. Account. Res. 7, 17–30. doi: 10.1108/AJAR-09-2020-0086.
  2. Agrawal, D., and Balasubramaniam Natarajan. (2023). Tracking and handling behavioral biases in active learning frameworks. Information Sciences. 641(1), 117-129.
  3. Ahmad, M., and Wu, Q. (2022). Does herding behavior matter in investment management and perceived market efficiency? Evidence from an emerging market. Manage. Decis. 60, 2148–2173. doi: 10.1108/MD-07-2020-0867.
  4. Ashrafi, B., Hajiha, Z., and Tehrani. R. (2023). Designing auditors' behavior model with emphasis on auditor's personal and general characteristics using foundation data method. Knowledge of management accounting and auditing. 12(45), 483-498. (In Persion)
  5. Brown N., K. Wei, and R. Wermers. 2014. Analyst recommendations, mutual fund herding, and overreaction in stock prices. Management Science 60: 1–20.
  6. Dhruv, S., Vandna, M., and Pathak, A. J. P. (2021). Emergence of behavioural finance: A study on behavioural biases during investment decision-making. Int. J. Econ. Bus. Res. 21, 223–234. doi: 10.1504/IJEBR.2021.113140
  7. Din, S. M. U., Mehmood, S. K., Shahzad, A., Ahmad, I., Davidyants, A., and Abu-Rumman, A. (2021). The impact of behavioral biases on herding behavior of investors in islamic financial products [original research]. Front. Psychol. 11:600570. doi: 10.3389/fpsyg.2020.600570.
  8. Dinantara, M. D., Narimawati, U., Affandi, A., Priadana, S., and Erlangga, H. (2022). The effect of financial literature and behavior on individual investment decision behavior. Int. J. Educ. Inf. Technol. Others 5, 77–85.
  9. Dustar, M., Mohammadnejhad, A., Javadian, M. (2016). Investigating the effect of collective behavior on risk-taking of managers of investment companies in Tehran Stock Exchange.Asset Management and Financial Assurance Quarterly, 5(2), 129-148. (In Persion)
  10. Fallahpur, S., Abdollahi, G. (2002). Identification and weighting of behavioral biases of investors in Tehran Stock Exchange market: Fuzzy AHP approach.Financial Research, 13(31), 120-99. (In Persion)
  11. Jamshidi, M. (2017). Investigating behavioral tendencies and factors influencing their creation in Ferishte investors, the 5th International Conference on Management and Accounting Techniques, Tehran. (In Persion)
  12. Kasoga, P. S. (2021). Heuristic biases and investment decisions: Multiple mediation mechanisms of risk tolerance and financial literacy—a survey at the Tanzania stock market. J. Money Bus. 1, 102–116. doi: 10.1108/JMB-10-2021-0037.
  13. Mohseninia, S., Babakhani, J. (2020). Investigating the effect of internal audit quality on the quality of financial reporting in companies listed on the Tehran Stock Exchange.Journal of Financial Accounting Research, 12(4), 19-38. (In Persion)
  14. Moradi, R., Ahmadi, F., Kordluie, H., Asadnia. J. (2021). Investigating the moderating role of behavioral biases on the relationship between individual characteristics of financial managers and company characteristics with the financial performance of companies listed on the Tehran Stock Exchange.Financial and Behavioral Research in Accounting, 1(2), 123-127. (In Persion)
  15. Natasya, N., Dyah Hayu, K., Widya, A., and Farah Margaretha, L. (2022). The effect between behavioral biases and investment decisions moderated by financial literacy on the millennial generation in Jakarta. Account. J. Binaniaga 7, 113–126. doi: 10.33062/ajb.v7i1.502.
  16. Racki, M., Mehrara, M., Abbasnejhad, H., Suri, A. (2020). Modeling the effect of loss aversion behavior on price dynamics and stock market returns (application of agent-based modeling in behavioral economics). Financial Science of Securities Analysis, 13(45), 165-180. (In Persion)
  17. Razani, S., Hoseini, S. A., Madahi, A. (2023). Maturity model of internal audit in the public sector (oil industry).Governmental Accounting.10(1), 10-30. (In Persion)
  18. Tarazudar, M., Gasemi, M., Mohseni, A. (2023). Presenting a model to identify the effect of behavioral trends and financial literacy and their role on investors' decision-making (based on grounded theory approach). Journal of accounting knowledge. 11(1), 122-130. (In Persion)
  19. Xin Deng , Shengmin Hung , Zheng Qiao , Mutual Fund Herding and Stock Price Crashes, Journal of Banking and Finance (2018), doi: 10.1016/j.jbankÞn.2018.07.014.
  20. Yash Chauhan, Nehal Ahmad, Vaishali Aggarwal, Abhijeet Chandrad, Herd Behavior and Asset Pricing in the Indian Stock Market, IIMB Management Review (2019), doi: https://doi.org/10.1016/j.iimb.2019.10.008
  21. Zanjirdar, M. (2015).The effect of mass behavior of institutional investors on stock returns. Financial and Economic Policy Quarterly, 4(15), 115-134. (In Persion)