Knowledge Sharing to Internal Auditors: Examining Procedural Fairness of the Internal Audit Process and Internal Auditor Type.

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Abstract

Knowledge sharing by employees helps internal auditors learn about critical information. However, employees may be hesitant to share knowledge with internal auditors and they may not share the same information with in-house and outsourced internal auditors. We develop theory on how procedural fairness at the start of an internal audit and auditor type influence two types of knowledge sharing: tacit knowledge sharing during an audit and subsequent knowledge sharing about material issues. We conduct a 2 X 2 between-participants experiment with MBA students. We find that enhancing perceptions of procedural fairness is an intervention that can increase knowledge sharing yet it depends on the internal auditor type and differs for type of knowledge sharing. Specifically, procedural fairness increases tacit knowledge sharing for outsourced internal auditors but not for in-house internal auditors. Yet, procedural fairness increases subsequent knowledge sharing for in-house internal auditors but not outsourced internal auditors.

Authors

• Megan Seymore, University of North Texas

• Jesse C Robertson, University of North Texas