Does Distrust Matter More than Trust? How Audit Judgment Is Influenced by Inconsistent Evidence

: Prior research considering the influence of trust on auditor judgment and decision making has largely ignored distrust, viewing distrust as one end of a unidimensional measure of trust. Psychology literature, however, suggests that trust and distrust are distinct constructs with fundamental differences. In this study, we argue that auditing research would benefit from embracing this conceptualization of both trust and distrust when examining auditor judgments. We conduct an experiment that examines whether situational trust and distrust mediate the relationship between the receipt of inconsistent evidence from the client and auditor effort. Results suggest that distrust has a greater influence on auditor effort than trust. We also find that the prior receipt of consistent evidence from the client weakens the negative influence that inconsistent evidence has on perceptions of trust and distrust, and violations of trust due to the receipt of inconsistent evidence are quick to repair.