Download This Article

Ronja Krane ORCID logo


Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.


As companies expand their operations across national borders, international internal audit assignments are becoming commonplace. However, the internal audit functions of multinational companies face unique issues since their work quality is influenced by interactions with employees from various locations and culturally diverse backgrounds. The aim of this paper is to analyze these interactions. For this purpose, fourteen qualitative in-depth interviews with internal audit practitioners working for globally operating companies are conducted. Qualitative content analysis is used to structure and analyze the interview data and results are presented within a conceptual framework based on Resource Dependence Theory and insights from conflict theory. The study examines the conflict-handling strategies that are employed during the distinct stages of cross-national internal audit assignments and sheds light on how internal auditors achieve their audit related goals while interacting with auditees of different cultural and linguistic backgrounds. Findings indicate that internal auditors are partly reliant on the knowledge and cooperation of auditees, and conflicts need to be handled in a manner which allows the internal audit function to obtain the necessary resources. Overall, results show that country and culture-specific differences can cause or complicate conflict situations and auditors are tasked with finding the difficult balance between trust and skepticism towards auditees when conducting cross-corporate audit assignments. This paper contributes to the scarce literature on the relationships between internal auditors and auditees and expands the current understanding of internal audit work in an international context.

Keywords: Internal Audit, International Context, Auditor-Auditee Relationship, Conflict

Acknowledgment: I acknowledge support by the Open Access Publication Fund of the University of Duisburg-Essen. I am thankful to participants of the EARNet 2017 Ph.D. Workshop in Leuven, Belgium, the AAA Auditing Section Midyear Meeting 2018 in Portland, USA and the 8th Doctoral Seminar of the Universities FU Berlin, TU Darmstadt, Duisburg-Essen, Hamburg and Ulm in Duisburg, Germany for their helpful comments and suggestions on earlier versions of this paper.

JEL Classification: M16, M42

Received: 09.04.2019

Accepted: 11.06.2019

Published online: 12.06.2019

How to cite this paper: Krane, R. (2019). Conflict-handling during multinational audits: The internal auditor-auditee relationship. Corporate Ownership & Control, 16(3), 159-173.