Addressing Unconscious Bias in Decision Making

According to a recent article in the American Institute of Certified Public Accountants (AICPA) Journal of Accountancy, many professionals, without realizing it, make “unconscious” choices regarding those who are different in terms of race, gender, geographic origin, college education and other factors. This “unconscious bias” is a hidden bias that can significantly undermine good decision making and impacts both personal and business decisions.

How much do you know about unconscious bias? Try a short, 10-question, online quiz to help test your knowledge on the subject. To learn more, watch the following AICPA Unconscious Bias webcast series of three information videos:

• “Help Me in the Heart - Understanding Unconscious Bias”: This session will help participants understand the full scope of what unconscious bias entails, where it comes from, and the areas of business it impacts. 
• “Look Me in the Brain – Identifying Unconscious Bias”: This session will help participants identify personal biases which might be holding us back from true inclusiveness.
• “Fix Me in the Act – Managing Unconscious Bias”: This session will help participants manage biases in a constructive manner to obtain the highest level of inclusiveness and performance. 

In addition, review previous blog postings on “bias” and how it affects the exercise of professional judgment.

The effective internal auditor: 7 key attributes

As the role of the internal auditor shifts, through regulatory changes or a more volatile economy, so do the skills required to do the job well. The skills shift is demonstrated by what companies expect of the internal audit function. Technical skills are a prerequisite, but those skills alone are not enough as the job’s scope broadens.

A recent report co-authored by Richard Chambers, chief executive and president of the Institute of Internal Auditors (IIA) provides insight on Succeeding as a 21st Century Internal Auditor: 7 Attributes of Highly Effective Internal Auditors. The report, produced by the IIA and global staffing firm Robert Half, discusses these seven traits: Integrity; Relationship building; Partnering; Communication; Teamwork; Diversity; and Continuous learning. These attributes fall into the category of soft skills, but more and more those skills are required, not desired.

For more information, read the Robert Half news release “Transformation of Skills Key to Success for Internal Auditors, Reveals Report.” In addition, review the related CGMA Magazine article “Internal Auditors Must Focus More Attention on Strategy.” Also, see related postings dealing with Internal Auditing.

Collaboration on Professional Judgment Matters for CAs – Part 2 of 3

As previously noted, a new research report has just been completed on Professional Judgment Matters: Assessing the Merits of Enhanced Communication and Collaboration.

The following discussion is Part 2 of a three-part excerpt from the executive summary in the report.


“Chapter 2 reviews the current academic and professional research literature on professional judgment. A number of important observations can be drawn from that review, with respect to the CA profession, decision making in financial reporting and auditing (including the role of professional scepticism) and the exercise of professional judgment.

The most important finding is that CAs need to keep in mind, at all times, the Rules of Professional Conduct. The Rules state that: “It is a mark of a profession that there is a voluntary assumption, by those who comprise it – the professional community – of ethical principles which are aimed, first and foremost, at protection of the public and, second, at achieving orderly and courteous conduct within the profession.” Furthermore, according to IFAC, the fundamental principles of professional ethics include integrity, objectivity, professional competence and due care, confidentiality and professional behaviour. All professional accountants must adhere to these principles regardless of the career path they may choose.

Chapter 3 is about creating a communications blog. It refers to two blogs, Migrating to IFRS and Corporate Reporting to Stakeholders, both of which emphasize Internet-based communications and the exercise of professional judgment. The number of postings to date and the significant number of pageviews for the recent period provide a measure of the success of Internet-based communications. This chapter concludes that it has been a very short time since the blog on Professional Judgment Matters: Guidance for Chartered Accountants was created on June 18, 2011. Considering the small number of posts to date (24), it is encouraging to see that the level of interest in the subject matter (research and guidance) is steadily increasing. It is also encouraging to see that the interest is becoming global in nature. This suggests that “If you build it, they will come!”

The project proposal for this research initiative calls for an open dialogue with selected CAs. The dialogue included seven face-to-face meetings on an ad hoc basis over a six-month period and an ongoing series of e-mails. In addition to a candid exchange of views, the participants provided several significant materials dealing with professional judgment matters. Those matters are discussed in Chapter 4 under four subtopics:

• Professional Judgment: A Pillar of Accounting Education;
• Teaching and Learning Professional Judgment;
• Outline for a Course on Professional Judgment; and
• Accountants’ Insecurity Relating to Work Diversity.

The dialogue also provided a strong incentive for engaging with CAs on a broader basis. This led directly to the development of an online survey to assess whether there is a need for enhanced communication and collaboration by CAs. Chapter 5 presents the results of an online survey called “Professional Judgment Matters for CAs.” The survey results reinforce the findings in the research literature and the key messages conveyed during the dialogue. Overall, there is considerable support (84%) for enhanced communication and collaboration by CAs, facilitated by an Internet-based resource centre.”

Additional excerpts from the executive summary are provided in Part 1 and Part 3 of this series of posts.