The effects of instruction and experience on the acquisition of auditing knowledge

Abstract

SYNOPSIS AND INTRODUCTION: Libby (1993) suggests a simple model of the acquisition of expertise where knowledge and ability determine performance, and instruction, experience, and ability determine the acquisition of knowledge. An important implication of the model is that a detailed understanding of the knowledge acquisition process is needed before the practical implications of expertise research are evident (see also Bonner and Pennington 1991; Waller and Felix 1984). Libby's review indicates, however, that the vast majority of studies of the knowledge acquisition process focus on what knowledge auditors acquire during a particular period of time with the firm, but not on what particular aspects of instruction and experience lead to superior knowledge.1 The latter type of study is necessary before firms can determine how best to organize auditors' training and experiences to allow efficient and effective acquisition of the necessary knowledge. The importance of analytical procedures in auditing and the popularity of ratio analysis as an analytical procedure are well-documented (e.g., Biggs and Wild 1984; Libby 1985). The current study focuses on the knowledge necessary to perform ratio analysis in audit planning. Specifically, we examine the effectiveness of various combinations of instruction and experience (practice and feedback) in producing this knowledge. The results indicate that combinations of instruction and no experience or of instruction and practice without feedback do not produce knowledge. Practice with explanatory feedback and any form of instruction creates