Debiasing the Curse of Knowledge in Audit Judgment

This research uses an experimental methodology to examine the "curse of knowledge" in judgment and the extent to which it is mitigated by accountability, experience, and counterexplanation. The curse of knowledge occurs when individuals are unable to (appropriately) disregard information already pro cessed. Important audit implications of the curse of knowledge arise in going concern evaluation and analytical review. Experiments 1 and 2 examine these two contexts with both auditors and MBA students. Results show significant curse of knowledge effects among both auditors and MBA students. These effects are not mitigated by accountability, consistent with Kennedy's (1993) debiasing framework. A third experimentfinds that counterexplanation (explaining whya particularoutcome might not occur) does eliminate the curse of knowledge.