The effect of data structure and information presentation format on performance evaluation judgments using business performance management systems



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Texas Tech University


Developments in accounting information systems technologies make various data presentation methods possible. However, system developers want to know how information presentation choices will affect judgments. The current study investigates how data hierarchy and information presentation format affect performance evaluation judgments. Data hierarchy is an important attribute for accounting information presentation. For example, the XBRL technology developed to improve the communication of accounting information presents accounting information hierarchically. Prior studies had examined the effect of presentation format on judgment, but none had specifically investigated how data hierarchy can influence accounting judgments. The current study relies on the theory of cognitive fit and cost-benefit analysis of cognition to develop a research model. The theory of cognitive fit argues that problem-solving performance is enhanced if information presentation matches the task type consistent with information processing strategies. In addition, cognitive psychology research suggests that the starting point used to drill down data hierarchies is an important factor in judgment of performance evaluation. A total of 107 subjects participated in a laboratory experiment. The experiment consisted of a 2x2x2 between-subject and within-subject design. Data hierarchy (hidden signal versus no-signal) and information presentation format (graphs versus tables) were between-subject factors. Task type (spatial versus symbolic) was manipulated as a within-subjects factor. Subjects were randomly assigned to four treatment cells and asked to perform two different tasks. The results indicate that subjects using data hierarchy without hidden signals of misleading solutions performed significantly better than subjects in the data hierarchy with hidden signals. In addition, subjects performed better when information presentation format matched task type. Finally, additional analysis suggests that the effect of graphical presentation of accounting information for spatial tasks may be dependent on how information is organized. The performance advantage of graphical display over tabular format for spatial tasks disappears when the data hierarchy does not contain hidden signals at an aggregate level. This study extends the extant literature on information display research. It provides a more complete understanding of cognitive fit by examining an important aspect of problem-solving element, data hierarchy, and how it interacts with information presentation format and task type.