Today the topic of our Bridge The GAAP – Accounting Podcast is logical relationships.  We’re going to discuss the topic by building a bridge that connects the ideas of Forrest Gump (Tom Hanks), Auditing Standard AU-C 520, and synchronicity.

We start off by discussing the Davie-Brown Index, which is a survey conducted by a marketing agency in order to measure different attributes of celebrities and popular personalities, including trustworthiness.  Tom Hanks repeatedly shows up at the top of the list, raising the question "What's so trustworthy about Forrest Gump?"

In attempt to answer the question, we turn to the famous study performed by social psychologists Hamilton and Gifford, which introduced the term "illusory correlation" while explaining how we form illogical judgments and stereotypes.  As accountants, understanding this process is important because we so often rely on analytical procedures.

This conversation leads into a discussion of Auditing Standard AU-C 520, which addresses the auditor's requirement for using analytical procedures at the end of an audit and discusses the requirements for the use of substantive analytical procedures as audit evidence.

The podcast ends by recalling Carl Jung's work to develop the concept of synchronicity, which is a relationship of events that is other than causal.