The influence of construal of self on internal auditors' judgments on whistle‐blowing: Evidence from China

• Date: 01 March 2019
• Author: Bella Zhuoru Zheng,Elaine Evans,Chris Patel
• DOI: http://doi.org/10.1111/ijau.12146
• Published date: 01 March 2019

ORIGINAL ARTICLE

The influence of construal of self on internal auditors'

judgments on whistle‐blowing: Evidence from China

Bella Zhuoru Zheng |Chris Patel |Elaine Evans

Department of Accounting and Corporate

Governance, Macquarie University, Sydney,

NSW, Australia

Correspondence

Bella Zhuoru Zheng, Department of

Accounting and Corporate Governance,

Macquarie University, Sydney, NSW,

Australia.

Email: bella.zheng@hotmail.com

Our paper contributes to the audit literature by examining whether internal auditors'

personal values measured by construal of self systematically influence their accep-

tance and likelihood of engaging in whistle‐blowing. China provides a particularly

appropriate national context for our study because evidence shows that the

traditional internal control systems have largely failed to achieve their objective of

preventing wrongdoings. Internal auditors have been selected as subjects because

of the importance placed on them by regulators and enterprises in designing and

implementing whistle‐blowing systems. Construal of self has been selected for

examination because it captures complex moral, cognitive processes experienced

by individuals at both cultural and personality levels. This study develops and finds

support for the hypotheses that, compared with independents,interdependent internal

auditors are less accepting and less likely to engage in whistle‐blowing. The results

also show the presence of “holier‐than‐thou”perception bias among internal auditors.

The findings may benefit local and multinational enterprises, regulators, and

researchers who are interested in designing and developing more compatible

whistle‐blowing policies and procedures.

KEYWORDS

“holier‐than‐thou”perceptionbias, construal of self, internal auditors'judgments, multidimensional

ethics measure

1|INTRODUCTION

The objective of this paper is to examine whether internal auditors'

personal values measured by construal of self systematically influence

their acceptance and likelihood of engaging in whistle‐blowing.

Largely as a result of globalization, national culture has been recog-

nized as an important variable that influences auditors' judgment

and decision making (Heinz, Patel, & Hellmann, 2013; Nolder & Riley,

2014; Patel, 2006). Prior research, such as Alleyne, Haniffa, and

Hudaib (2016), Jubb (2000), and Wilson, McNellis, and Latham

(2018), has been conducted predominantly in Anglo‐American coun-

tries, and there have been calls in the literature to examine auditors'

judgment in other cultural settings (Nelson & Tan, 2005; Nolder &

Riley, 2014).

1

As suggested by Nolder and Riley (2014) and Ying

and Patel (2016), more research is needed to examine the growing

cultural diversity in firms within and across countries. We respond

to these calls by examining within‐country differences in personal

values among internal auditors in China. Evidence shows that the

biggest cultural gaps are within countries and not between them.

For example, in a study of 32 countries, Kirkman, Taras, and Steel

(2016), using meta‐analysis, found that over 80% of the differences

in work‐related values were found within countries, and less than

Data Availability: Data used in this study are available from the first author upon

request.

1

An evaluation of the whistle‐blowing literature in leading accounting journals

classified as A* and A by the Australian Business Deans Council (ABDC) shows

that 67 out of the 80 studies were conducted in Anglo‐American countries; 13

studies were conducted in non‐Anglo‐American countries (two in Malaysia, one

in India, one in Spain, one in South Africa, one in Hong Kong, one in Israel, one

inTurkey, two in Korea, and three in China). ABDC provides a journal quality list

to assist academics to target papers at journals with an appropriate standard.

Received: 8 April 2018 Revised: 20 July 2018 Accepted: 12 October 2018

DOI: 10.1111/ijau.12146

Int J Audit. 2019;23:73–85. © 2018 John Wiley & Sons Ltdwileyonlinelibrary.com/journal/ijau 73