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An International Meeting of American Accounting
Association
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Examining Continuous Assurance Mitigation Effects on the Belief Revisions of Non-professional Investors: A Multi-sample Approach |
Robert Pinsker
Old Dominion University
Bryan Church
Georgia Tech University
Abstract: Experimental market research has shown that investor recency effects can carryover into the stock market, which could have negative impacts on both investors and firms. This paper uses three proxies for non-professional investors (i.e., undergraduate accounting students, MBA students, and CPAs) to investigate whether continuous assurance mitigates belief revision magnitude, which is believed to be a cause of recency.
Results indicate that continuous assurance is an effective mitigator of belief revision magnitudes for all participants. Further, undergraduates had larger belief revisions than CPAs, but MBA students did not have any differences with the other groups. Researchers should exercise care when using a sample from one population while attempting to explain non-professional investor behavior in the aggregate. The paper’s results complement the extant belief revision and assurance literatures.