Public auditors are expected to detect errors in public institutions’ accounting (accounting errors) and to support public institutions in identifying, detecting, and resolving errors from an economic rationality perspective (economic errors). This study examines how the error culture in public sector audit organizations affects auditors’ management of auditees’ accounting and economic errors. The results provide empirical evidence that public auditors working in an organization with an open error culture treat auditees’ errors more openly and actively, regardless of the error type. An open error culture is positively mediated on the performance of the audited institution by the auditors’ management of economic errors. This means that if the public auditor works in an organization with a strong error culture, he/she demonstrates a more positive management of the auditee’s economic errors and the audited organization performs better.    «

Public auditors are expected to detect errors in public institutions’ accounting (accounting errors) and to support public institutions in identifying, detecting, and resolving errors from an economic rationality perspective (economic errors). This study examines how the error culture in public sector audit organizations affects auditors’ management of auditees’ accounting and economic errors. The results provide empirical evidence that public auditors working in an organization with an open err...    »