The Effect Of Leadership Style Perception On Auditors Communication Behavior: A LISREL Analysisx

Abstract

The purpose of the study was to determine whether the leadership style perception is associated with auditors’ communication behavior for information gathering activities. Questionnaire data were collected from 195 Taiwanese auditors with at least one year of audit experience. As proposed, the study indicates that CPA firms’ leadership style would have a significant effect on auditors’ communication behavior for exchanging and gathering information. According to the LISREL analysis, leaders in the participating Taiwan CPA firms tend to adopt initiating leadership style that concurs with the perception that CPA firms are formalized and structured. This initiating leadership style helps auditors’ communication behavior in information accuracy and satisfaction with supervisors.  However, initiating leadership style has a negative effect on boundary spanning.  It is the suggestion of the study that leaders in the CPA firms might want to encourage their auditors to engage more in boundary spanning activities for a better decision quality.