Navigating Automation Bias: A Social Cognitive Perspective on Malaysian Accountants' Professional Scepticism in the Digital Era

Yap, Wei Sheng (2026) Navigating Automation Bias: A Social Cognitive Perspective on Malaysian Accountants' Professional Scepticism in the Digital Era. Masters thesis, Tunku Abdul Rahman University of Management and Technology.

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Abstract

This study examines the determinants of professional scepticism among Malaysian accountants in the digital era, with particular emphasis on the influence of Artificial Intelligence (AI) and Robotic Process Automation (RPA). As the accounting profession undergoes rapid digital transformation, concerns have emerged regarding over-reliance on automated systems and the potential erosion of professional scepticism. The International Ethics Standards Board for Accountants (IESBA) has incorporated the concept of an “inquiring mind” into the 2025 Code of Ethics, which applies to all accountants. According to Hurtt (2010), an inquiring mind represents a core characteristic of professional scepticism. Notably, while technological advancements enhance efficiency and accuracy, maintaining professional scepticism remains essential for ensuring the quality of financial reporting and preventing fraud. Therefore, it is imperative to identify the key factors influencing professional scepticism within the context of AI and RPA adoption. Prior research has primarily focused on personal traits or external pressures, such as time constraints and client influence, in explaining professional scepticism. Limited studies have examined the interaction between personal and environmental factors, as proposed by Social Cognitive Theory (SCT). Additionally, the moderating role of ethical leadership in the relationship between automation bias and professional scepticism remains underexplored. To extend SCT, this study incorporates a technology-induced cognitive bias, i.e. automation bias, to examine how stable internal personal factors counteract automation bias and influence professional scepticism. Grounded by SCT, this study adopts an integrated framework encompassing personal, environmental, and cognitive factors. Time pressure (TP), artificial intelligence literacy (AIL), internal locus of control (ILC), and external locus of control (ELC) are modelled as independent variables, automation bias (AB) as a mediating variable, and ethical leadership (EL) as a moderating variable, with professional scepticism (PS) as the dependent variable. Data were collected from individuals working in the accounting profession in Malaysia who use AI and RPA in their work. This study employed a structured, self-administered questionnaire. A total of 385 valid responses were analysed using SPSS and SmartPLS 4.1.1.6 to evaluate both the measurement and structural models. The findings reveal that external locus of control has a significant positive effect on automation bias, indicating that individuals with stronger external locus of control are more likely to rely on automated systems. In contrast, artificial intelligence literacy and internal locus of control do not exhibit significant effects on automation bias. Furthermore, automation bias has a significant negative impact on professional scepticism, suggesting that excessive reliance on automated outputs reduces critical evaluation. Additionally, Ethical leadership negatively moderates the relationship between automation bias and professional scepticism, thereby mitigating its adverse effects and strengthening professional scepticism. Automation bias does not mediate the relationship between time pressure and professional scepticism, while time pressure is found to have a positive relationship with professional scepticism. This suggests that, in a digital environment, efficiency gains from AI and RPA may allow accountants to have more time to critically assess evidence. Overall, this study successfully demonstrates that professional scepticism in the digital accounting environment is shaped by the interplay of technological reliance, individual psychological traits, technology-induced bias, and organisational environment context. The findings offer important implications for accounting professionals, organisations, and regulators in fostering critical thinking, reducing automation bias, and promoting ethical leadership. This study contributes to the literature by extending Social Cognitive Theory through the incorporation of technology-induced cognitive bias, providing a more comprehensive understanding of professional scepticism in the era of AI and RPA.