The Impact of Error-Management Climate, Error Type and Error Originator on Auditors’ Reporting Errors Discovered on Audit Work Papers

We examine factors affecting the auditor’s willingness to report their own or their peers’ self-discovered errors in working papers subsequent to detailed working paper review. Prior research has shown that errors in working papers are detected in the review process; however, such detection rates only rarely exceed 50% of the seeded errors. Hence, measures that encourage auditors to be alert to their own (or their peers’) potential errors any time they revisit the audit working papers may be valuable in detecting such residual errors and potentially correcting them before damage occurs to the audit firm or its client. We hypothesize that three factors affect the auditor’s willingness to report post detailed review discovered errors: the local office error-management climate (open versus blame), the type of error (mechanical versus conceptual) and who committed the error (the individual who committed the error (self) or a peer). Local office error-management climate is said to be open and supportive where errors and mistakes are accepted as part of everyday life as long as they are learned from and not repeated. In alternative, a blame error-management climate focuses on a “get it right the first time” culture where mistakes are not tolerated and blame gets attached to those admitting to or found committing such errors. We find that error-management climate has a significant overall effect on auditor willingness to report errors, as does who committed the error originally. We find both predicted and unpredicted significant interactions among the three factors that qualify these observed significant main effects. We discuss implications for audit practice and further research

Evaluation of Measured and Facies-Based Effective Permeability and the Significance for Reservoir Mapping and Connectivity

This study addresses how reservoir-scale permeability models vary depending on the scale of investigation of the input permeability values. A common practice in reservoir modeling is to directly use permeability measurements from core-plugs or probe permeametry in petrophysical modeling. Three-dimensional permeability model cells are often several orders of magnitude larger than the scale of investigation (volume support) of the permeability measurement. This scale difference can produce unrealistic results in the permeability model which may not be representative of the reservoir heterogeneity. To explore this issue, 3-D core lithofacies and permeability models of the Terry Formation in the Denver Basin, Colorado were created with permeability values measured using a mini-probe permeameter. These measured-permeability values were acquired by facies and lamina type and flow-based upscaling was used to generate effective-permeability values by facies. After upscaling, the range of permeability is reduced, and the average permeability is decreased by as much as 50%. Using the original- and effective-permeability values, the significance of fine-scale permeability heterogeneity associated with lithofacies that exist below the resolution of reservoir model cells was investigated through comparative analysis of field-scale, 3-D permeability models and resulting static connectivity of permeability distributions. Statically connected reservoir volumes to producing wells defined by permeability cutoffs shows that for relatively lower permeability cutoffs, there is a distinct difference in connected volume between original- and effective-permeability models. In some cases, this difference is 50% lower for connectivity in the effective-permeability model. This is significant because it represents the reservoir volume connected to wells for potential production. As the permeability cutoff (reservoir definition) increases, static connectivity decreases and the differences between the original- and effective-permeability models is reduced. The differences between original- and effective-permeability values and models indicate why it is important to utilize scale-dependent, facies-based permeability values for reservoir mapping at the field scale

Error orientation questionnaire (EOQ): reliability, validity, and different language equivalence

An Error Orientation Questionnaire (EOQ) was developed, consisting of eight scales on attitudes to and on coping with errors at work. In Study I (representative sample of a German city, N=478) six scales were developed with the help of a confirmatory factor analysis using LISREL techniques. They comprise error competence, learning from errors, error risk taking, error strain, error anticipation, covering up errors. All constructs were validated. In a second study, items were added to the scales and two additional scales, ‘error communication’ and ‘thinking about errors’, were included. The scales were translated into English and Dutch and 160 students in the Netherlands filled out both language versions (Study II). The 8-factor solutions in English and Dutch were replicated. The issue of language equivalence of these two language versions were taken up (equivalence across correlations exists). Potentially biasing variables did not influence the solutions. Practical uses of the EOQ are pointed out