Time Budget Pressure, Ethical Organizational Culture, Stress Arousal and Incidence of Reduced Audit Quality

Abstract

The purpose of this paper is to address the impact of time budget pressure on audit quality
practices under conditions of ethical organizational culture. The study also investigates the
mediating impact of stress arousal on the relationship between time budget pressure and reduced
audit quality practices. The investigation of the study is based on a field survey of financial
auditors employed by audit firms operating in Saudi Arabia. Self- administrated questionnaires
were distributed to financial auditors for data collection. After establishing the reliability and
validity of the scale, descriptive statistics, collinearity statistics, correlation analysis and
moderated logistic regression analysis were conducted. The study finds relationships among time
budget pressure, stress arousal ethical organizational culture and reduced audit quality
practices. The ethical organizational culture is negatively related to reduced audit quality
practices, time budget pressure and stress arousal. The study also highlights the influence of
ethical organizational culture firstly on time budget pressure and stress arousal relationship and
secondly on stress arousal and reduced audit quality practices relationship. This is the first study
to report the effect of ethical organizational culture on time budget pressure, stress arousal and
reduced audit quality practices as data of auditors working in Saudi Arabia.