Judgment Traps

The
two common judgment traps are the “rush to solve” and Judgment Triggers:
Solving the Wrong Problem.

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The
“rush to solve” is when the auditor wanted to solve a problem right away. This
hinders the auditor to make a professional judgment, since he or she is making
the final judgment without completely following the steps of the judgment process.
This can lead to the auditor coming up with a suboptimal outcome and/or worse ends
up with solving the wrong problem.

 

The
Judgment Triggers: Solving the Wrong Problem is the tendency to solve the wrong
problem at hand. The auditor might have over- or under- analyzed an issue,
which can then potentially direct the auditor to a wrong problem or issue. As a
result, this creates a poor judgment for the auditor because the real issue was
not being solved.

 

Professional Skepticism

Analyzing issues
in multiple judgment frames can help the auditor to discover or find an array
of different perspectives. When considering different frames, the auditor can
bring in additional insights or methods to understand a particular case.
Another way it can enhance an auditor’s professional skepticism is that he or
she can bring new or additional options or alternatives that might not have
been considered in the early process of the investigation.

 

For instance, suppose a client’s revenue for the
past three years has been significantly low and the client attributes its cause
to financial statement fraud by the management. The auditor should understand
the client’s reasoning and then apply professional skepticism by considering
other possibilities, such as error in revenue recognition and/or simply poor
management decisions. It is important to apply different points of view and
search for evidence that could help the auditor either identify or rule out the
possibility of error or fraud.