Value and Communication of Different Assurance Levels

This study investigates: (1) the impacts of different assurance levels on the intentions of consumers with different assurance knowledge levels to purchase from retailers of different business reputation levels; and (2) whether providing a contrast for work performed in assurance reports improves low assurance knowledge consumers' discerning of moderate and high assurance levels. These issues are examined using two controlled experiments. Findings indicate that the presence of assurance increases consumer purchase intention and that the benefit of assurance is not moderated by retailers' business reputation. We also find that both assurance knowledge and contrast for work performed enhance consumers' ability to discern the extent and level of assurance provided in moderate and high assurance reports. However, consumer purchase intentions are indifferent to perceived assurance level differences. Our findings have important implications for the public accounting profession on the value and communication of different assurance levels.