Tài liệu Research " INTERNAL AUDITOR JOB STRESS AND TURNOVER INTENTIONS " pptx

Specifically, it identifies organizational and individual job stressors; determines to what extent burnout is a problem for internal auditors; examines the relationships among job stress

INTERNAL AUDITOR JOB STRESS AND TURNOVER INTENTIONS

LINDA LEE LARSON

submitted in partial fulfillment of requirements for the degree

DOCTOR OF BUSINESS ADMINISTRATION

at the CLEVELAND STATE UNIVERSITY

August, 1997

Copyright 1997 by

Larson, Linda Lee

All rights reserved

UMI Microform 9828073 Copyright 1998, by UMI Company Ail rights reserved This microform edition is protected against unauthorized

copying under Title 17, United States Code

UMI

300 North Zeeb Road

Ann Arbor, MI 48103

Copyright by Linda Lee Larson 1997

All Rights Reserved

for the College of Business Administration

and the College of Graduate Studies by

DEDICATION

To my brother, Robert K Larson,

for his support and encouragement during this project.

| would like to express my sincere thanks to all the members of my

committee for their hard work on my behalf Thank you all for your advice, assistance, and encouragement A special thank you is in order for both Dr

Heidi Meier and Dr Peter Poznanski, who encouraged me to do research in this

area.

INTERNAL AUDITOR JOB STRESS AND TURNOVER INTENTIONS

LINDA LEE LARSON

ABSTRACT Internal audit is considered a stressful profession The job is typically

characterized by heavy workloads, many deadlines, and time pressures Job- related stress may cause job burnout and job dissatisfaction that in turn may

lead to increased turnover intentions Turnover may be very costly to the

organization and may prevent the internal audit function from meeting its varied

responsibilities

This study investigates the causes and effects of job-related stress among

internal auditors Specifically, it identifies organizational and individual job

stressors; determines to what extent burnout is a problem for internal auditors; examines the relationships among job stress, burnout, job dissatisfaction, job-

related self-esteem, and turnover intentions; and determines whether differences exist according to position, industry, gender, number of years as an internal

auditor and size of the internal audit department

A model proposing that individual and organizational job-related stressors

are directly related to both job dissatisfaction and burnout, which are then

related to job turnover intentions, was developed for this study

Data for this study was obtained from a questionnaire mailed to a national

sample of 1500 internal auditors Various scores were calculated for each

respondent, including scores for fifteen job stressors, job-related self-esteem, job

vi

statistics and correlations were calculated and differences between scores for different demographic groupings were analyzed using ANOVA The sample as a

whole was analyzed using structural equation modeling to determine the

strength of the relationships among job stressors, job dissatisfaction, burnout, and turnover intentions

Results show that organizational variables (rewards, human resource development, politics, and participation) were the highest ranking causes of job

stress for the internal auditors in this study Burnout and job dissatisfaction were positively related to turnover intentions Job-related self-esteem was negatively

related to the other variables

In conclusion, this study provides new insights into the causes and

consequences of job stress among internal auditors This study contributes to the behavioral accounting literature by introducing burnout as a new area of study and has several implications for the profession of internal auditing

vii

TABLE OF CONTENTS

Page

LIST OF FIGURES 00000 o ooo ccec cece cc ecceccceececceeeccceuccccsecescesaeceescteneceeesseeeaees xii

The Research Problem 0.0.0 cceeceeceseccceceeeececcecceecesceecsneeeeeeseees 8

The Model 00 o cece cee ce ceeeceeeccecccceccecceeecceeceecceceseceecesceceeeeeeeeees 8

Stress Studies _ _ TQ TQ HH HT TH nh kh nen cv 29

Accountants other than Internal Audifors -. . -~«- 29

Internal AudiifOrs - - - - HH HH nh Hy ng nh kh nh nh y ckc 40 Conclusion - - - HH HH ng TK nh ch ky nh cv 43

Human Resource Developmert - - - - -SSnn se ee 59 R@eWarđS - QQ Q SH SH TH ng HH ng 60 PArtiCiPatiOn 1Ä 60 Ủnderutilization - SH 2211 n HH ng khen ke 61 Supervisory Sityle - Q0 Q2 022121 HH HH HH HH HH ngu 62 Organization Structure - QQQL HH HH H HH kg sư 63

Job-Related Self-Esteem 2.0.0.0 coco cec cece ccc ceecssceessesecessnsssssssecenersssecese 67 dob Dissatisfaction HH HH HT nh ng sec 69 Turnover IntentiOnS - - HH TT kh rec 70 Burnout and Turnover Intentions - HH ng ng key 71

Te Model 002 cc ccccccccceccesseecsesesseecececceccesssssssessesseaseseessttenseeetseeens 72 Conclusion - - 0000101 nn HH ng HT ng ng set 73

IV RESEARCH METHODOLOGY Q QQQ HH SH ng ngư nrsec 75

Research Questions and Hypotheses 00 0 cccccee cc eeeeeecesseeeeseseveneees 76 Research Questions - L 0Q TQ 21H HH HT ng vn gkp 76 Research Hypotheses -_LLLQQ Q00 nHHn ng HH nào 77 Instrument Development À - - - HH HT HH ng ng key 79 Work-Related StreSSOrS - HS HH HH TH kg ngu 79 JOD Burnout eee cccceccccereeececccecsseseesceceesusesesensstaceseaeees 81 Job-Related Self-Esteem oo cecccceeceseeeccocesseeeeeeesseenes 82 dob Dissatisfaction eeccccccccccseseccccecevsnaececversteatertaseess 83 Turnover Intentions - - TL TQ TT T222 11H nnn TH n TT ng ky 83 Demographics - - - - SH HH n1 ng r reg 84 Pre-tesfing - - TL 2n nQ.H HH HH HH ng TT kg kg 84 Data Collection - - - - - c1 220 SH HS HH HH KH ng ng kg ng 85 Sample Selection - L Q0 HH HH HH H kg ng 85 Survey lmplementation - - - L c n9 ng ng ng ng rec 85 Data AnalySiS - - LQ QQQQ HQ HQ HH HH HH HH TT ngưng ca 87 Initial Data AnalySiS Q0 TQ TQ QnH2H HH HH HH ngàng ưu 87 CorrelafiOrnS - - L 2L 13H HH HH HH KH TH ng Hư crrec 88 Factor AnalySiS - - - QQ TQ HH HH TH nH HH ngưng 88 Structural Equation Modeling Overview co cocccccce, 89 SEM Procedures Used - HH HH ng ng 91 Analysis of Variance ccc ceecececcceesececccseccesaceceesssececeesssenss 94 COMCIUSION oo ee cccccccceecccccecscsecececcesuecessececsusecsessessststseectseeetsectesses 95

"LG ôn cm 96

BC se 96 Test for Non-Response Bias - QQQQQ Q00 0Q HS HH, 98

VI DISCUSSION OF RESULTS AND CONTRIBUTIONS

Discussion of Results and Implications .c cc cceeeeeeeeeteeeee 133 Work-Related Stressors - - TQ Q HH HH HH n ng nh ren 133

dob Dissatisfaction and Turnover Intentions 137 dJob Burnout À - - - - - - c0 HS HS TK SH ng nh ch re, 140 Job-Related Self-Esteem 0.00.0 cece ccccccccececcececceccceccececcececeecenees 141

The Model - - - cece ccc eeeccceccescccccenseceececccceeceeccussnessseereereeses 141

Limitations - - - _- TQ Q HH HT nn nu TH nn HT nh nh nu nh chen ren 142 Future Research - - - - QC Q Q20 HH HH TH Hy ky nh vn nh ch nu c 143 Contribufions - - - - - - - TQ HQ HH TH SH ni KH nn nh ng ch khe 144

REFERENCES - _ LQ TQ QQQQQnnn HH ng SH Hy HH ch HH nh ky 447

APPENDICES On HH TH TH KT TH nh như nh nen ry 162

A Instrument and Lefters cee cee cecceceeceececeeccececceccersecvccecscsseserseees 163

B Computer Output and Exhibifs QQQ nhe 177

Correlations: Outcome Variables to Job Stressors . 108

Primary Model Comparisons . - - - -Q nọ re 110

Comparison of Mean Scores of Job Stress Variables-

Comparison of Mean Scores of Other Variables -

Comparison of Mean Scores of Variables -

z)/0jae5 (a0 €xe0eis› 0 e 121

Comparison of Mean Scores of Variables -

Comparison of Mean Scores of Variables -

By Years as an Internal Auditor - - - - - Tnnsnn ng 124

Comparison of Mean Scores of Variables -

2) 0>]P4- No) ^\0eii0ìc-)1⁄4ỐOŨOO 126

Comparison of Mean Scores of Variables -

By Type of Turnover Indicated TQ nn HH nh ng ve 128

Summary of Results by Hypothesis TQ nsssseeheerrre 130

xi

INTRODUCTION

Internal Auditors

Internal auditing has been referred to as a hidden profession because it

has long been overshadowed by its sister profession, public accounting

(Rabinowitz, 1993) In the last few years the potential of the internal audit

department to strengthen internal controls, improve performance, and reduce the

likelihood of fraudulent activities has become more widely recognized (Boyle,

1993) Internal auditing has evolved into a highly visible profession that

performs a very important corporate function (Apostolou, Pasewark & Strawser,

1992)

Internal auditors are employees of an organization who review company

operations to determine whether acceptable policies and procedures are

followed, whether established standards are met, whether resources are used efficiently, and whether the organization's objectives are being achieved

(Sawyer, 1988)

In fulfilling their responsibilities, internal auditors review a wide range of corporate functions, including, but not limited to, financial areas Also included

on an annual audit schedule may be audits of compliance with company rules and procedures, audits of computerized systems, operational! audits, and

internal consulting projects (Schiff, 1990) The specific nature of internal

auditing work will vary depending upon the industry and the needs of the

organization (Mautz, Tiessen, & Colson, 1984)

Various pronouncements and legislative actions over the last twenty years have influenced the role of internal auditors One such early legislative action was the Foreign Corrupt Practices Act of 1977 (FCPA) The FCPA requires that public corporations maintain an adequate system of internal

controls Then the 1987 Report of the National Commission on Fraudulent

Financial Reporting (The Treadway Report) recommended that all public

companies establish an internal audit function to assist management in meeting

as part of financial statement reporting Having a system of internal controls in

place is important for fraud prevention (Thornhill, 1996) The presence of an

internal audit department has been shown to have an inhibiting effect on fraud (Welch, Holmes, & Strawser, 1996).

certain extent during the year-end audit (Taylor, Peden, & Welch, 1997) In

1991 the Auditing Standards Board of the American Institute of Public

Accountants (AICPA) issued Statement on Auditing Standards No 65 titled, “The

Auditor's Consideration of the Internal Audit Function in an Audit of Financial Statements” (SAS No 65) SAS No 65 states that if external auditors are to rely

on the work of internal auditors, various criteria must be considered The

external auditors therefore must be satisfied that specific criteria are being met if they are to rely on the work of a company’s internal audit department (American

Institute of Certified Public Accountants, 1991)

In summary, various external pressures have mandated organizations to

maintain reliable internal control systems and qualified internal audit

departments to monitor these systems (Boyle, 1993) To meet these demands, a

high level of internal audit quality is imperative To achieve this level of quality

and to meet their many responsibilities, internal audit departments must be

composed of competent and well-trained professionals (Sawyer, 1988)

Professionalism and staff experience are critical issues in maintaining quality in

the internal audit process (Pariser, 1992) Meeting these many and varied

responsibilities becomes difficult to accomplish if the internal audit department is

composed primarily of “short timers" (Quarles, 1994b)

Retention of internal audit staff is a significant concern for many internal audit managers and directors Internal auditing has historically had high staff

turnover rates Kusel (1994) reported that from 1986 through 1990, annual

internal audit staff turnover rates averaged about 20 percent Oxner and Kusel (1994) determined that even the groups of internal auditors with traditionally the

lowest turnover rates (government, banking, and education) the sixth year

cumulative turnover rates were 67.6%, 86.6%, and 65.1% respectively

High levels of internal auditor turnover may be very costly to the

organization (Mautz et al., 1984) and may also adversely affect the quality of internal audit work (Quarles, 1994b) Constantly having to recruit and train new trainees is both time-consuming and wasteful because of the steep learning curve involved in becoming an effective internal auditor (McNeil, 1997)

Therefore, high internal audit turnover rates are not in the best interest of the

organization

Long-time auditors are important if an organization desires to maintain an acceptable level of audit productivity, efficiency and effectiveness McNeil (1997) states that corporations need career internal auditors to ensure that

proper controls are in place, to protect organizational image, and to reduce fraud

and embezzlement

In conclusion, a competent internal function can make an important

corporate contribution A competent internal audit function is essential if the internal audit department is to meet all of its varied responsibilities Therefore, retention efforts must be accelerated and strengthened if internal auditors are to fulfill their mission (Ridley, 1996)

Accounting is considered a very stressful profession (Coppage & French, 1987) The very nature of the work is often stressful The job is typically

characterized by heavy workloads, many deadlines, and often excessive time

pressures Accountants are also often faced with conflicting demands They are

under pressure to produce quality work and yet are often under serious budget

constraints to accomplish the work in less time (Coppage & French, 1987)

In public accounting, partners may try to minimize the time spent on jobs

and as a result may create abnormal stress for their subordinates Other

stressors may include extensive business travel and frequently changing work locations (Coppage & French, 1987) Consequently, fairly high stress levels may be natural and unavoidable at times (Comish, Swindle & Daboval, 1994)

Accountants as individuals are extremely vuinerable to stress symptoms

because they are often intense, aggressive, perfectionistic, and extremely

committed to their work Although severe mental and physical health problems are extreme results of stress, persons in management positions should realize

that talented persons will likely leave if the stress threatens their physical and/or emotional health (Matthews, 1992)

Although public accounting is well Known for being stressful, the rest of

the accounting profession, including management accounting and internal

auditing, also has its share of stress In many ways the problems are the same (Kimes, 1977) Due to the nature of audit work, internal auditors face many of the same stressors facing public accountants (Kusel & Deyoub, 1983) Internal

audit jobs typically include overnight travel, time pressures and budget

constraints (Brown & Mendenhall, 1995; Sears, 1992) The typical internal audit

working conditions may well contribute to excessive work-related stress (Wood &

Wilson, 1988)

When stress becomes excessive, job burnout (hereafter referred to as

“burnout”) may occur Symptoms may include being tired and lonely, feeling worried and trapped, feeling frustration caused by low personal productivity, and showing a lack of enthusiasm for the work (Rose, 1986) Burnout occurs when a person is overworked and gradually this may wear down his or her reserves,

resulting in mental, physical, and emotional exhaustion Over-achieving

accountants are typical burnout victims and often do nct realize that there is a

problem until burnout becomes serious (Helliwell, 1982)

Burnout has been discussed in the accounting literature as being a

problem for the accounting profession (Choo, 1983) Burnout has been noted as

a potential problem for management accountants (Kimes, 1977) and controllers (Goff, 1995) Public accountants are purported to be particularly susceptible to burnout because they are often expected to work large amounts of overtime

(Helliwell, 1982) Audit work, by its very nature, often involves dealing with

people under stressful and sometimes adversarial conditions (Wilson & Wood,

1985) and, therefore, carries with it the risk of burnout Burnout is also

recognized as being a problem for internal auditors (Kusel & Deyoub, 1983) Internal audit work has many of the stresses that cultivate burnout if preventive

measures are not taken (Wilson & Wood, 1989).

ongoing, pervasive problem for the whole accounting profession (Doll, 1983;

Reed & Kratchman, 1987) Stress has been shown to be a major factor

contributing to high staff turnover for public accounting firms (Collins & Killough,

1992; Rasch & Harrell, 1990; Senatra, 1980) The costs of this turnover are

substantial and the consequences may be dysfunctional to the organization Managing turnover is important because the people who leave may be among

the best employees (Doll, 1983) Excessive turnover of quality personnel

disrupts planning, results in a loss of job efficiency, and will affect staff morale

and client relations As previous discussed, turnover is a problem for the

internal auditing profession Job-related stress has been blamed for internal

auditor burnout and increased turnover (Wilson & Wood, 1985) However, very

little research has been conducted in this area

The Research Study The purpose of this study is to investigate the relationships among job

stress, job dissatisfaction, job-related self-esteem, job burnout, and turnover

intentions for internal auditors More specifically, this study proposes to identify

the specific stress-producing factors in the work place that are causing job burnout and job dissatisfaction that in turn are causing increased turnover

intentions among internal auditors

The Research Problem

This study will address the following research questions:

1 What are the specific job-related organizational and individual stressors

for internal auditors?

2 To what extent is burnout a problem for internal auditors?

3 What are the relationships among job stress, job dissatisfaction, job

burnout, and turnover intentions for internal auditors?

4 Are there differences in the reported stressors and in the levels of job

dissatisfaction, job burnout, and turnover intentions according to position,

industry, gender, number of years as an internal auditor, size of internal

audit department, or the type of turnover intention indicated?

5 Does job-related self-esteem affect these relationships?

The Model

The model for this study (shown as Figure 1) proposes that individual and organizational job-related stressors are directly related to both job dissatisfaction and burnout Both job dissatisfaction and burnout are then proposed to be related to job turnover intentions Burnout is proposed to be affecting turnover intentions both directly and indirectly by its effect on job dissatisfaction

Job Scope

10

Hypotheses

Considering prior research, the following hypotheses will be tested to

examine the relationships among the job-related stressors, job dissatisfaction,

job-related self-esteem, job burnout, and turnover intentions These hypotheses,

in alternate form, are:

H1: Each job stressor is significantly and positively related to burnout H2: Each job stressor is significantly and positively related to job

dissatisfaction

H3: Burnout is significantly and positively related to job dissatisfaction

H4: Burnout is significantly and positively related to turnover intentions H5: Job dissatisfaction is significantly and positively related to turnover

intentions

H6: There are significant differences in the reported levels of stressors

and stress outcomes (job dissatisfaction, job burnout, and turnover

intentions) among internal auditors according to position

H7: There are significant differences in the reported stressors and

stress outcomes (job dissatisfaction, job burnout, and turnover intentions) among internal auditors according to industry grouping

H8: There are significant differences in the reported stressors and

stress outcomes (job dissatisfaction, job burnout, and turnover intentions) among internal auditors according to gender

H9: There are significant differences in the reported stressors and

stress outcomes (job dissatisfaction, job burnout, and turnover

intentions) among internal auditors according to years as an

internal auditor

H10: There are significant differences in the reported stressors and

stress outcomes (job dissatisfaction, job burnout, and turnover intentions) among internal auditors according to size of their

internal audit staff

H11: There are significant differences in the reported stressors and

stress outcomes (job dissatisfaction, job burnout, and turnover

intentions) among internal auditors according to the type of turnover intentions indicated (either in or out of the internal audit

profession)

H12: Job-related self-esteem is significantly and negatively related to

the level of the job-related stressors

H13: Job-related self-esteem is significantly and negatively related to job

burnout

Methodology

Data for this study was obtained by sending a survey questionnaire to a national sample of 1500 internal auditors Questions were asked concerning individual and organizational job stressors, job dissatisfaction, job burnout, job- related self-esteem and turnover intentions The research instrument was a combination of previously used and validated instruments

Once the results were received, various scores were calculated for each respondent The scores generated included fifteen job stressor scores, a job-

12

related self-esteem score, a job dissatisfaction score, a burnout score, and three

turnover intention scores Descriptive statistics and correlations were

calculated The differences between scores for various demographic groupings

of respondents were analyzed using ANOVA The sample as a whole was

analyzed using structural equation modeling to determine the strength of the

relationships among job stressors, job dissatisfaction, burnout, and turnover intentions

Summary of Results Organizational stressors were the highest ranking causes of job stress for

the internal auditors in this study The four leading job stressors included

rewards, human resource development, politics, and participation Next came

two individual job stressors: time pressure and career progress Job burnout

and job dissatisfaction scores were moderate for the sample as a whole Both

turnover intention and job-related self-esteem scores were quite high,

The variables were all correlated as expected (See Chapter V for

details.) The individual and organizational job stressors were all positively

related to job burnout, job dissatisfaction, and turnover intentions Both burnout and job dissatisfaction were positively related to turnover intentions Job

burnout was positively related to job dissatisfaction, and job-related self-esteem was shown to be negatively related to the job stressors, job burnout, job

dissatisfaction, and turnover intentions

When the full modei was analyzed using structural equation modeling, two primary job factors emerged: Stress1 and Stress2 Stressi (the

environmental stress factor) is composed primarily of organizational stressors

and two individual stressors (job scope and role ambiguity) Stress2 (the

overload factor) is composed primarily of time pressure, quantitative overload,

qualitative overload, and responsibility for others

Stress1 (the organizational stress factor) was more strongly related to

both job dissatisfaction and job burnout than Stress2 (the overioad factor) The

relationship between Stress2 and job dissatisfaction was negative Apparently

factors related to the working environment were the most serious job stressors

for the internal auditors who completed this survey

Significant differences were noted in the reported levels of both job

stressors and stress outcomes when mean scores were compared by various

demographic groupings In particular, managers were less stressed than the

other groups of internal auditors They also were significantly less dissatisfied

with their jobs than seniors and had significantly higher self-esteem scores

Significant differences were noted between men and women for the

outcome variables Women’s burnout and intent to leave internal audit scores were significantly higher than men’s scores The group that included individuals with 12 or more years in internal auditing had significantly lower scores for many

of the job stress variables than persons with fewer years in internal auditing They also had lower scores for turnover intentions than those in the other

groups (The majority of the persons in the former group were audit managers.)

Significant differences were also noted for job stressors when the size of the internal staff was considered Persons working on large (> 15 auditor) staffs

14

had significantly higher reported stress levels and very significantly higher job

dissatisfaction, job burnout, and turnover intention scores

In conclusion, the results of this study make a contribution to the

behavioral accounting literature concerning internal auditors and introduce

burnout as a new area of study

Organization of the Dissertation Chapter II contains a review of the accounting behavioral research

relating to the variables in the model Chapter Ill explains the theoretical basis

for this research project Chapter IV contains a description of the research

methodology that was used in the study It describes the development of the research instrument, sampling procedures, and statistical methods used to

analyze the data Chapter V presents the results of the study Chapter VI

discusses the results of the study, addresses the contributions and limitations of the study, and proposes suggestions for future research

LITERATURE REVIEW

Introduction

A considerable amount of research has been conducted concerning the

behavioral issues of accountants Although various groups of accountants have been studied, the preponderance of this research has focused upon accountants employed by public accounting firms This chapter will review the job

satisfaction, job turnover, and stress studies that have been conducted using

accountants as subjects

First, job satisfaction and turnover studies will be reviewed Prior studies

of public accountants, government accountants, and management accountants

will be discussed first Then studies concerning the job satisfaction and turnover

of internal! auditors will be reviewed The second section will review stress

studies concerning accountants In a similar manner, discussions of stress

studies of accountants other than internal auditors will precede studies of stress

among internal auditors

15

Rhode, Sorensen, & Lawler

Seiler & Sapp

Benke & Rhode

Knapp

Konstans & Ferris

Albrecht, Brown, & Field

Aranya & others

Harrell & others

Norris & Niebuhr

Bullen & Flamholtz

Ward, Mosiey, & Ward

Reed & Kratchman

Colareili, Dean, & Konstans

Trapp, Hermanson, & Tumer

Rasch & Harrell

Maupin

Gregson

Brown & Corless

Chatman

Street & Bishop

Reed, Kratchman, & Strawser

Mautz, Tiessen, & Colson

Harrell, Chewning, & Taylor

Elbert & Swenson

Byington & Johnston

Clark & Larkin

Apostolou, Pasewark, & Strawser

Rebele & Michaels Haskins, Baglioni, & Cooper Snead & Harrell

Collins & Killough

Smith, Everly, & Johns Gregson & Wendell Sanders, Fulks, & Knoblett

Rahman & Zanzi Fogarty

Work-Related Stress Internal Auditors

Smith & Katzman Wilson & Wood

Tipgos, Stambaugh, & Trebby

Pei & Davis Azad Brown & Mendenhall

Job Satisfaction and Turnover Studies Accountants other than Internal Auditors

Rhode, Sorensen, and Lawler (1977) conducted a longitudinal study of

turnover in public accounting firms They analyzed the reasons for the turnover

of 99 subjects who had left public accounting by the end of three-and-a-half years Participants in the study typically identified the work hours, budget

pressures, and office politics as reasons for leaving public accounting The

authors suggested that public accounting firms could reduce turnover by

concentrating upon improving the work environment and supervisory

relationships

Seiler and Sapp (1979) evaluated five elements of job satisfaction for a

national sample of 1338 industrial accountants These job satisfaction scores were then compared to the scores from a population of general employees

Accountants as a group were highly satisfied with the nature of their work They

were least satisfied with promotion opportunities and most satisfied with their co- workers and supervisors

Benke and Rhode (1980) analyzed the level of job satisfaction, personal characteristics, and job features of senior-level professionals employed by large public accounting firms Their sample included 126 auditors, 68 tax specialists,

and 64 consulting specialists The authors determined that personal

characteristics, job context features, and other variables affect the level of job

satisfaction that in turn affects the probability of turnover

18

Knapp (1980) conducted a follow-up study of 57 accountants who had left

public accounting Correlations were used to identify the major reasons for the turnover Leading reasons for leaving included a favorable outside job

opportunity, the amount of overtime required, and management indifference

toward employees

Konstans and Ferris (1981) studied turnover in public accounting firms

They determined that during the first year of employment the turnover rate for female and male auditors was about the same By the third year the turnover rate for females was nearly twice what it was for males Seventy-five percent of the females and 52% of the males had left their public accounting firm employer

by the end of the fourth year Primary reasons given for leaving the firm were dissatisfaction with job content, dissatisfaction with the firm, and better job

opportunities elsewhere

Albrecht, Brown, and Field (1981) studied job satisfaction for a national sample of public accountants The authors based their study upon Herzberg’s Motivation-Hygiene theory, with job facets being identified as being either

motivators or hygiene factors The 296 respondents rated each of 27 job facets

on a seven-point scale The subjects’ attitudes concerning their professional lives were recorded and analyzed The most favorable dimensions were

opportunity for responsibility, opportunity to do challenging work, opportunity for growth, variety on the job, self esteem or respect, and freedom on the job Least

satisfying job dimensions included firm policy and administration, compensation,

feedback on performance, recognition for a job well done, contribution to society,

and job security

Aranya, Pollock, and Amernic (1981) studied job satisfaction and

professional commitment among 1206 Canadian Chartered Accountants They noted that organizational commitment was not incompatible with professional

commitment and that satisfaction with income had a positive influence on

professional commitment

Aranya, Lachman, and Amernic (1982) studied job satisfaction for a

sample of 1206 Canadian Chartered Accountants Their sample included three

groups of accountants: partners and sole practitioners in private practice,

employees in professional settings, and employees in large companies They

determined that job satisfaction in all three occupational situations was

influenced by organizational commitment and work needs deprivation

Lachman and Aranya (1986) studied job satisfaction and organizational commitment among three groups of California Certified Public Accountants

(CPA's): self-employed CPA's, CPA’s employed in professional organizations, and CPA's employed by other types of organizations They determined that the three groups differed significantly Professional commitment, organizational commitment, and intent to leave varied by employment setting

Harrell and Stahl (1984) conducted a study of accountants based upon McClelland’s trichotomy of needs theory This theory says that a person has three types of needs: need for affiliation, need for power, and need for

achievement Their study involved 77 professionals from one office of a “Big

20

Eight’ public accounting firm The authors determined that individuals with relatively large power and large achievement needs appeared to experience

higher job satisfaction in a large public accounting firm than those who did not

Harrell and Eickhoff (1988) conducted a longitudinal turnover study using

426 new auditors hired by a “Big Eight” public accounting firm The authors defined influence-oriented individuals as those who possess relatively large power needs along with relatively small affiliation needs Results indicated that

influence-oriented auditors experienced higher job satisfaction, expressed

higher organizational commitment, and indicated higher career intentions than other auditors They also exhibited lower voluntary personnel turnover

Norris and Niebuhr (1983) looked into professionalism, organizational

commitment, and job satisfaction in public accounting Sixty-two “Big Eight’ accountants were the subjects of their survey The authors determined that

accountants who reported high levels of professional commitment also typically

reported high levels of organizational commitment Both factors were noted to

be strongly related to job satisfaction

Bullen and Flamholtz (1985) studied intended turnover for a sample of

125 staff auditors in a large public accounting firm They identified 11 key

dimensions of job satisfaction Then they used these 11 dimensions in a

regression that produced statistically significant differences in intended turnover based on tenure with the firm The strongest turnover intentions were among the group that had been with the firm for two to four years This group was the least satisfied for 9 of the 11 job dimensions Those individuals at the senior level

were typically under the most stress due to the long overtime hours and tight time budgets In addition, the seniors did not think that they were being

adequately compensated for their efforts This group was also most likely to

suffer burnout and leave

Ward, Mosley, and Ward (1986) studied the job satisfaction of 229 female

public accountants Their results indicated that female accountants generally appeared satisfied with the work environment They showed a very high level of

satisfaction with co-workers and supervision and a moderately high level of

satisfaction with the nature of the work itself Female accountants were least satisfied with the pay and promotional opportunities

Reed and Kratchman (1987) analyzed data from a sample of 175

accounting graduates, including 112 management accountants and 63 public accountants As a group, the accountants expressed satisfaction with the nature

of their work, with their supervisors and co-workers, but were dissatisfied with

current pay and promotion opportunities Overall, job satisfaction was greatest

for older married accountants who were either employed in industry or who

earned a high salary Turnover intentions were noted to relate to overall job

satisfaction and personal maturity

Colarelli, Dean, and Konstans (1987) studied the comparative effects of personal factors versus job situational factors upon job satisfaction for a sample

of 280 entry levei accountants at 11 offices of a “Big Eight” public accounting firm They determined that the situational variables of autonomy, feedback, and

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job context factors correlated strongly with both job satisfaction and

organizational commitment

Trapp, Hermanson, and Turner (1989) conducted a study to determine

why women leave public accounting Descriptive statistics showed that the three

leading reasons for women leaving public accounting were better professional

opportunities elsewhere, better working conditions, and higher pay

Rasch and Harrell (1990) studied the impact of personal characteristics

on the turnover of 66 accountants in “Big Eight” public accounting firms

Determinants of turnover included work-related stress, job satisfaction, and

turnover intentions Strong negative correlations were noted between turnover

intentions and job satisfaction Turnover intentions and work stress were

positively correlated Results indicated that personal characteristics affected

turnover intentions directly and/or through work-related stress and job

satisfaction Tenure was also noted to negatively affect turnover intentions of individuals The explanatory ability of the overall model was very strong

Maupin (1990) studied the effect of sex role orientation upon levels of job satisfaction for a sample of 461 public accountants (221 males and 240

females) Subjects were given the Bem Sex Role Inventory (BSR!) (Bem, 1974)

to identify each subject as having either a masculine, a feminine, an

androgynous, or an undifferentiated sex-role orientation The results were then correlated with job satisfaction scores for each subject Overall results indicated that the majority of partners and audit managers in public accounting firms have

masculine or androgynous behavior patterns (Androgynous means that the

subject has both high masculinity and high femininity scores.)

Maupin and Lehman (1994) conducted a follow-up study for the sample used in the Maupin (1990) study Results indicated that turnover was the lowest

for auditors (either male or female) with the masculine or androgynous sex-role

orientation The authors’ overall conclusion was that a high stereotypic

masculine orientation was a key ingredient to advancement, job satisfaction, and long tenure in a large “Big Six” public accounting firm

Gregson (1990) studied the effect of communication satisfaction upon job

satisfaction for a sample of 311 CPA's He determined that communication

satisfaction was directly related to job satisfaction He also noted that job

satisfaction was directly related negatively to turnover intentions

Brown and Corless (1990) investigated the job satisfaction of a sample of

173 government auditors Results indicated that government auditors overall

were very satisfied with their promotion opportunities and that the women in the sample were very satisfied with their pay However, both men and women

reported less than average satisfaction with supervision, co-workers, and the nature of the work on their current job

In a longitudinal study Chatman (1991) studied the matching of people

and organizations in public accounting firms Her subjects were 171 new hires from eight public accounting firms The Organizational Culture Profile was used

to determine person-organization fit Using regression to analyze the data, she

determined that recruits whose values matched those of the employing firm

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adjusted to the work environment more quickly, felt the most satisfied, and, as a result, had lower turnover intentions

Street and Bishop (1991) studied the need profiles of professional

accountants employed in public accounting, in industry, and in government The

need for achievement was the dominant motivation for the accountants tested The need profiles of accountants differed by type of employer, especially in terms of power needs The authors recommended that employers attempt to recruit personnel whose motivational characteristics match those of others in the organization

Reed, Kratchman, and Strawser (1994) studied a sample of graduates of

a large Midwestern university They measured the job satisfaction and turnover intentions of 87 men and 78 women The authors concluded that although the

subjects exhibited high content scores (that indicated job satisfaction),

contextual (job environment) factors were creating dissatisfaction The authors

concluded that high turnover continues because of job environment issues

Patten (1995) compared job satisfaction of entry-level accountants at large (“Big Six”) versus small (local or regional) public accounting firms Results indicated that the three major elements of supervisory action recommended by

the Accounting Education Change Commission (AECC) (leadership and

mentoring, working conditions, and assignments) were all highly correlated with reported job satisfaction scores for the entire sample Entry level accountants at local and regional firms reported higher levels of job satisfaction on average

than did accountants working for the “Big 6” firms

Internal Auditors

Mautz, Tiessen, and Colson (1984) conducted an extensive study of the

internal audit profession One focus of that study concerned the job satisfaction

of internal auditors Based on responses from 330 internal audit directors and

1240 staff internal auditors, Mautz et al (1984) determined that most internal

auditors were quite satisfied with their work Internal auditors liked the

intellectual challenge of the work and the wide variety of assignments Least appealing aspects of the job were the travel requirements and dealing with the external auditors

The authors noted correlations between job satisfaction and three groups

of work-related attitude variables, including career orientation variables, job characteristics, and organizational variables The authors also studied

organizational structure variables, including formalization, intraorganizational

support, centralization, flexibility, authority, and participation

Most internal auditors found the work to be attractive, interesting, and

very educational However, the majority had no intention of staying in the field

Aithough the authors presented various suppositions as to the cause, they could not provide conclusive reasons for this lack of interest in becoming a career auditor

Harrell, Chewning, and Taylor (1986) studied organizational-professional

conflict, job satisfaction, and turnover intentions among internal auditors Using

a sample of 59 internal auditors from three banks, organizational-professional conflict was determined to be negatively related to job satisfaction and

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professional commitment Supervisory status was positively related to

organizational commitment, and organizational commitment was positively

related to job satisfaction Tenure with the organization, professional

commitment, and job satisfaction were ail negatively related to turnover

intentions The study reported low overall levels of organizational-professional

conflict However, due to the very small sample size and the non-random nature

of the sample, the results of this study may not be generalizable to the

profession as a whole

Elbert and Swenson (1990) asked a sample of 26 internal auditors to rank

35 reward criteria both in terms of importance and in terms of dissatisfaction

For the group, 9 of the 12 most important rewards were intrinsic Seven of the

12 rewards that they were most dissatisfied with were also intrinsic Extrinsic

rewards indicated as being both important and dissatisfying included

advancement opportunities and salary The highest dissatisfaction factors

included feedback, self-fulfillment, advancement or promotion opportunity,

mentoring, prestige within the company, self-esteem, creativity/innovation, team work environment, salary, participation in goal setting, independent thought, and

authority Intrinsic rewards were determined to be very important to the staff

Byington and Johnston (1991) studied turnover intentions for a sample of

82 internal auditors from one chapter of The Institute of Internal Auditors (IIA) They determined that the ethical environment may influence an internal auditor's

intent to leave an organization However, compensation appeared to have the greatest influence on the decision to leave a company.

Clark and Larkin (1992) measured the job satisfaction, organizational and

professional commitments, and need deficiencies of 245 IIA members from one chapter Problem areas noted included advancement opportunities,

management concern for employees, opportunities for self-fulfillment, and

salary The authors reported a high level of job satisfaction among internal audit

professionals in their survey However, the results may be biased toward the views of those in audit management positions because only 23% of the sample

population were staff auditors

Apostolou, Pasewark, and Strawser (1993) studied the effects of senior

internal auditor leadership behavior on job satisfaction for 50 teams of internal

auditors from 11 organizations Using a 23-factor taxonomy of leadership

behavior, the authors tested two leadership behavior constructs: initiating

structure and consideration Initiating structure is the defining and structuring of leadership roles and those of subordinates to result in goal attainment

Consideration is the relationship orientation This approach is characterized by mutual trust, respect for subordinate behavior, and consideration for feelings Results indicated that both consideration (providing praise and recognition) and initiation (task-oriented) behavior results in increased staff job satisfaction

Quarles (1994a) investigated job satisfaction, organizational commitment,

and turnover intentions for information systems auditors He determined that

both supervisor status and participation in decision making were significantly

positively related to job satisfaction Job satisfaction, in turn, was significantly positively related to organizational commitment and negatively related to