This research was undertaken to test the effects of conservatism on the decisions made by auditors. The evaluation of the research results provided by the two psychological tests indicated that, when measured on the construct of resistance to change, auditors as a group are essentially heterogeneous and slightly conservative. However, the auditors' test scores on the construct of aversion to risk reflected a homogeneous group who were distinctly conservative. Based on these results, this research seems to indicate that the firm effect is more important in auditors' decision making than personal characteristics except, perhaps, in the area of compliance testing decisions. If this is indeed the case, it could be said that the different audit philosophies held by the public accounting firms and instilled in their auditors may be the prime cause of the substantial differences that have been continuously found in auditor judgments.