Problem
Knapp, M. C., & Knapp, C. A. (2012). Cognitive Biases in Audit Engagements. CPA Journal, 82(6), 40.
There were several examples given of accountants who fell prey to one cognitive bias or another which resulted in bad judgments. Do you think a forensic accountant could also be manipulated using a cognitive bias? If so, which ones should you be on the lookout for and how can you ensure that they could not be used against you?
A. Do you think auditors performing a forensic audit are biased towards finding something? How would you recommend auditors recognize and correct for confirmation biases, familiarity biases, or any other biases you can think of?
B. Can you think of a time when you tried to use framing bias to tilt a decision in your favor or to sway someone to your way of thinking? Is it just human nature to want to pre-dispose your audience to a more favorable conclusion or do you think it is wrong? Do you think you could recognize it if someone used it during an interview in a forensic audit?
C. Do you think all biases are bad or are they just something that needs to be considered? At what point do you think potential biases should be addressed during a forensic audit?
D. They say hindsight is 20/20. Can you think of any decisions that you have made in the past that caused an error in judgment due to cognitive biases? If so, what caused the biases? Which type of cognitive bias was it? Which "De-Bais" technique do you think would have helped you?