work with internal audit. These individual differences could very well exert significant influence over any task that requires significant judgment. The study originated with Auditing Standard No. 5, which the Public Company Accounting Oversight Board approved as a way to make Sarbanes-Oxley audits more efficient and cost-effective, in part by allowing external auditors to rely on the work of others, including internal auditors. “We did this study to see whether external auditors would really start to use internal auditors’ work,” Bierstaker said in an interview. “What we found was, if it was a high-risk area, for example, they were still reluctant to rely on internal auditors. And another thing that would get in the way was the professionalism of the internal auditors. In looking at the barriers to communication, what we found was that if the communication skills of the internal auditors weren’t that good, that could be another potential problem area.” Other studies have also found that internal auditors may not have as much training in communication “soft skills” as external auditors, Bierstaker noted. “What we found was that if an external auditor had a negative prior experience with an internal auditor, they might be reluctant to use internal auditors’ work,” he said. “And work styles came into play too because if an external auditor had a conflict avoidance work style, and the CFO was really pushing to rely on internal audit, they might just do it to avoid a conflict with the CFO. But if the external auditors had more of an activist work style, if they were more comfortable pushing back and saying, ‘No, I still don’t want to rely on internal audit, even though you’re telling us they’re really great,’ they would still stand up more to the CFO, so it kind of depended more on their own work style.” Bierstaker recently presented the study at the Center for Global Leadership at Villanova, where it won the Research Excellence Award. He is planning to submit the study to academic journals for publication, and he has volunteered to work on synthesizing the research with other academics for the PCAOB.
2011 Media Report Villanova School of Business Page 112