Dr. Tina Carpenter

Professor

Tina D. Carpenter is the Dan Smith Professor of Accounting and EY Faculty Fellow at the J.M. Tull School of Accounting, Terry College of Business, University of Georgia. She earned her Ph.D., M.Ed., and B.S. in Accounting from Florida State University. Her research focuses on judgment and decision-making in auditing, management fraud, and emerging technologies. She has published in leading journals such as The Accounting Review, Auditing: A Journal of Practice & Theory, and Behavioral Research in Accounting. Her work has been recognized with awards including the AAA Deloitte Wildman Medal and multiple Outstanding Manuscript Awards. Prior to her academic career, she worked as a senior auditor at Arthur Andersen. Tina has served on PCAOB fraud panels and her research has been cited by the PCAOB, SEC, and in TIME magazine.

The paper explores how engaging auditors’ innovation mindset can improve audit effectiveness when using data analytics, particularly in fraud detection. It addresses two key challenges:
  1. Goal conflict: auditors are increasingly expected to provide client insights alongside ensuring audit quality, which can reduce performance on primary audit tasks.
  2. Cognitive flexibility: essential for interpreting complex data analytics outputs and maintaining professional skepticism.
The authors propose that priming an innovation mindset enhances cognitive flexibility, enabling auditors to manage competing goals and improve judgment quality. They design an experimental study to test whether creativity prompts mitigate negative effects of goal conflict and lead to better fraud risk assessments and audit procedures. Key contributions:
  • Highlights risks of conflicting goals in audits using data analytics.
  • Suggests creativity interventions to strengthen auditors’ professional skepticism.
  • Provides insights for regulators and firms on fostering innovation to improve audit quality.
Data analytics has become a prominent tool for audit firms, which exalt its capabilities to promote audit quality. However, whether auditors have the appropriate mindset to fully leverage the capabilities of data analytics is yet unclear. Further, as data analytics becomes more prevalent in audit engagements, auditors are encouraged to also use this technology to provide client insights. This use has sparked concern from regulators that this additional goal could negatively impact audit quality by shifting an auditors’ focus and/or impacting independence. This could happen as these goals may compete for the same cognitive resources and auditors face time constraints. In addition, the focus on providing insights could be viewed as an auditor operating in more of an advisory (non-audit) role. In this study, we seek to understand whether encouraging auditors to be creative by employing an innovation mindset and instructing them to identify clients’ insights, when using data analytics, has a meaningful positive? impact on audit quality. We examine this using an experiment in which audit quality means the ability to address seeded fraud in a hypothetical engagement. Our results indicate that encouraging auditors to be creative increases their cognitive flexibility, which results in better identification of effective audit procedures (i.e., procedures targeting fraud). In addition, when a creative prompt is paired with a new goal to provide client insights, auditor judgments improve even more. Finally, encouraging auditor creativity also appears to improve their identification of value-added client insights. We recommend that firms look at creativity as a tool to improve auditor judgments. We point out for those concerned about adding a goal to provide client insights that this goal may not have a negative impact and in some instances may even improve audit quality.  
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