The impact of auditors’ awareness of the profession’s reputation for independence on auditors’ ethical judgement

Purpose - The purpose of this paper is to develop and test the scale of auditors’ awareness of the profession’s reputation for independence, defined as the degree to which auditors recognise the importance of the reputation for independence and acknowledge the impact of their judgements and decisions on that reputation, and to provide preliminary evidence of an association between auditors’ awareness of the profession’s reputation and auditors’ ethical judgement. Design/methodology/approach - A seven-item scale was developed to measure auditors’ awareness of the profession’s reputation for independence, and an auditing case was used to measure auditors’ ethical judgement. A survey questionnaire of practising auditors working in auditing firms in Indonesia provides data for testing the validity and reliability of the new scale and proposed hypothesis. Findings - The findings show that the scale is unidimensional and has satisfied reliability and validity. Moreover, the preliminary evidence of a positive association between the new scale and auditors’ ethical judgement is provided. Research limitations/implications - Further studies should test the validity and reliability of the scale of awareness of the profession’s reputation for independence with larger data and in different settings. Investigation of the antecedent factors of auditors’ awareness of the profession’s reputation for independence is suggested. Originality/value - This paper develops a new measure, namely, the awareness of the profession’s reputation for independence. Preliminary evidence to establish an association between that awareness and auditor ethical judgement is provided.