Clarifying the decision-making mystery: drivers of professional skepticism, ego depletion and overconfidence in independent auditors’ quality of judgment

Purpose - This study aims to investigate the influence of professional skepticism (PS) on the quality of judgment and decision-making (QJDM) among Iranian Certified Public Accountants (CPAs) while considering the moderating effects of ego depletion (ED) and overconfidence (OC). Design/methodology/approach - Nonprobabilistic sampling was used to collect data through questionnaires and direct engagement with 950 Iranian CPA members, resulting in 300 completed responses for analysis. Findings - The study confirms that PS significantly positively impacts QJDM among independent auditors. Therefore, a high level of trait PS could improve QJDM. In addition, a majority of auditors experience ED and suffer from OC bias due to their extensive knowledge, experience and self-efficacy. ED and OC play negative moderating roles in attenuating the effect of PS on QJDM. Research limitations/implications - The study emphasizes that integrating PS into auditors’ codes of ethics and improving audit work systems can significantly enhance the quality of auditing practices. Furthermore, addressing existence of OC and ED among auditors will further benefit the audit process. Implementing these measures will lead to more accurate assignment and distribution of audit work among independent auditors, ultimately resulting in more reliable and objective auditing judgment and making decisions. Originality/value - This study not only approves the vital role of PS, ED and OC in the QJDM of independent auditors but also contributes to the existing QJDM literature in auditing.