We conduct an experiment to investigate whether the effects of an SAS No. 90-like quality assessment standard (QAS) on auditors’ decision to accept a client-preferred accounting method is jointly moderated by the nature of advice from an audit firm’s technical department and the strength of the client’s justification. Results indicate that, in the absence of advice, the presence of QAS does not affect auditors’ decision, regardless of client justification strength. However, in the presence of advice from the technical department, the presence of QAS significantly reduces auditors’ propensity to accept the client-preferred method, but only when the advice explicitly recommends the use of the most appropriate method and the client’s justification is strong. These findings demonstrate the complementary roles that professional standards and audit firms’ technical departments play in enhancing the quality of auditors’ decisions, and indicate that the nature of advice matters.

Research indicates that justifiability of a decision is a key determinant of work quality. In this paper, we investigate whether and how the requirement for preparers to justify an audit conclusion to a reviewer with task preferences that are similar to or dissimilar from their explicitly stated initial task preferences determine the nature and extent of justifications documented in their workpapers, and how this effect is moderated by their technical and tacit managerial knowledge. Results of an experiment with auditors as participants indicate that auditors use different forms of justifications under different circumstances. Auditors with high tacit managerial knowledge and high technical knowledge have a higher proclivity to enumerate more pro versus con reasons, and to consider a wider breadth of issues when they are required to justify their conclusions to reviewers with dissimilar task preferences. In contrast, high tacit managerial knowledge auditors required to justify to reviewers with similar initial task preferences have a greater tendency to employ an evidence framing approach, in which language is used to emphasize consistent evidence by downplaying associated inconsistent evidence. In additional analyses, we find that these three specific forms of justifications are positively associated with evaluations of work quality.