The basic goal of audit judgment research is to improve auditor decision making (Ashton 1982; Biggs 1985). Previous auditor judgment studies show that environmental context is one of the critical factors that affects judgment performance (see e.g., Libby and Luft 1993). The purpose of this study is to investigate the effects of one of the contextual variables in auditing (i.e., group decision making) on decision process and performance.^ In terms of decision processes, auditors developed a shared problem representation, after interaction, which showed characteristics of a more well-developed knowledge structure. The interaction also affected auditors such that they concentrated relatively more on discussing and evaluating than reacquiring information. Another effect of interaction was found in auditors\u27 mitigating factor generation. Specifically, auditors increased concentration on explaining the causes of the problems, on financial aspects of mitigation, and decreased their dependence on guidelines provided by SAS 59.^ In terms of performance, however, interacting auditors did not perform better than individual auditors in terms of all performance measures (i.e., accuracy, probability estimation, and confidence). Possible reasons for this poor performance of interacting auditors include output interference effects, the lack of ecological validity of the study (i.e., the absence of the hierarchical nature of a dyad), and the difference in the degree of difficulty of the cases that they evaluated. The most interesting finding of the study is that the effects of auditor interaction was maximized when the members of a dyad were heterogeneous. This result suggests a practical implication for staffing.