Whistleblowing by auditors: the role of professional commitment and independence commitment

Abstract

Purpose Despite various regulatory frameworks to combat unethical conduct, fraud and corruption remain alarmingly high. While whistleblowing is an important mechanism to identify and prevent unethical conduct, there is a lack of empirical studies on this issue in the Malaysian context, especially whistleblowing within the audit firms. Therefore, the purpose of this paper is to examine the whistleblowing intention of external auditors in Malaysia and the factors influencing this intention. Design/methodology/approach Data were collected using a structured questionnaire that was sent by post to external auditors throughout Malaysia. Participants were selected using a convenience non-probability sampling technique. A total of 274 responses were analyzed. SmartPLS version 3.2.8 was used for the analysis. Findings Professional commitment and independence commitment had a positive influence on whistleblowing intention, supporting the argument that professional factors can increase the intention of the external auditors to whistleblow. Perceived behavioural control had a positive relationship with whistleblowing intention, while there is no evidence to indicate that attitude and subjective norms influence whistleblowing intention. Originality/value This study explored whistleblowing among external auditors in Malaysia by focussing on the professional factors of professional commitment and independence commitment, which were hypothesized to be key factors in intention to whistleblow. These factors were incorporated with a multi-component of attitude, subjective norms and perceived behavioural control, which were derived from the theory of planned behaviour. The findings have implications for the auditing profession because they provide a better understanding of the factors that influence the whistleblowing intention of external auditors.

Professional Commitment And Whistleblowing Intention: The Role Of National Culture

“…The auditor's with high professional commitment tend to intend to blow the audit firm's fraud case. This finding also supports previous empirical research that the strong accountant's professional commitment, a higher tendency of accountant obligation to report fraudulent actions (Hall et al, 2005;Ismail & Yuhanis, 2018;Mansor et al, 2020;Taylor & Curtis, 2010).…”

“…Auditors tend to hide unethical behavior to save coworkers/superiors' names and not tarnish the profession and organization (Brody et al, 1998). If the whistleblowing action is forced to be carried out, auditors tend to internally report colleagues and superiors' unethical behavior (Mansor et al, 2020). This study empirically supports previous research results (Brody et al, 1999;Rustiarini & Sunarsih, 2017).…”

“…The desire motivates auditors to disclose actions that violate the rules or harm the public interest (Taylor & Curtis, 2010). Auditors with high professional commitment will show a willingness to report their peers' mistakes (Mansor et al, 2020). Previous empirical findings state that professional JRAK 11.1 commitment significantly affects public sector auditors' tendency to behave ethically (Ismail & Yuhanis, 2018;Mansor et al, 2020).…”

“…As professionals, auditors are responsible for protecting the public interest, especially those outside the company (Hwang et al, 2008). Auditors try to eradicate parties that behave unethically or violate professional standards (Mansor et al, 2020). This action is an effort to protect the auditor profession's reputation and at once time reduces the public gap (Taylor & Curtis, 2010).…”

“…The study proves that professional commitment increases the auditor's intention to report fraud, both internal and external channels. Second, research about whistleblowing intention on external auditors is relatively limited (Mansor et al, 2020). Ideally, an accountant must maintain professional commitment Suddaby et al, 2009).…”