Promotion opportunities and the promotion and reward evaluation criteria used are both under the direct

control of an organization and subject to the organization's policies. If these two elements are found to have significant effects on outcomes such as organizational commitment, job satisfaction and turnover intent then that direct control permits their alteration as necessary to produce a positive impact on those outcomes. An increased understanding of the ways through which organizations can affect organizational commitment, job satisfaction and turnover intentions for internal auditors is needed due to the potential detrimental effects of those three elements on the increasingly important role of internal auditors in the auditing and reporting process. The recent issuance of Statement on Auditing Standards 65 (SAS 65) (AICPA, 1991) underscores the role of the internal auditor in relation to the independent audit process. Under the provisions of SAS 65 an independent auditor may rely to an extent on the work of internal auditors but must assess their competence and objectivity before doing so. To make that assessment SAS 65 identifies a number of specific criteria to be considered including: (1) the professional experience of the internal auditors, (2) their levels of professional certification and continuing professional education, (3) the practices regarding audit assignments, and (4) the policies prohibiting internal auditors from auditing areas where they were recently employed or are scheduled to be employed after leaving the internal audit function. However, low levels of organizational commitment and job satisfaction along with high levels of turnover may adversely impact these criteria. For example, high turnover in conjunction with low levels of job satisfaction and low organizational commitment may (1) reduce the level of professional experience and skill in the department, (2) reduce the emphasis on and opportunities for continuing professional education for internal auditors in the department, (3) alter internal auditor assignment policies so that repeat assignments are necessary, and (4) strain application and enforcement of the policies regarding prior and post internal audit department assignments. The possibility that low job satisfaction and high turnover intentions exist for internal auditors is suggested by two studies of internal auditors. Smith and Uecker (1976) report that internal auditors express lower levels of job satisfaction than do middle-level managers in general. A high level of turnover intent among internal auditors is suggested by Mautz, Tiessen and Colson (1984) in a study involving over 1,200 internal audit staff members. That study indicates that 75% of the internal auditors questioned did not plan to make internal auditing a career and of that group 61% planned to leave internal auditing within three years. In part the high internal auditor turnover intentions reported by Mautz et al. (1984) may be due to the use of internal audits as a "training ground" for other organizational units. If this is the case, then high turnover and the potential reduced role of the internal auditors in relation to the independent audit should be considered as unavoidable costs of that training. On the other hand if the desire to leave the internal audit function is being driven by personal characteristics or attributes that are strictly under the control of the individual, then high turnover may be considered an unavoidable cost of employing those particular individuals. However, if high levels of turnover intentions are being driven by structural elements of the organization which promote discontent and which contribute to the desire to leave the internal audit function, then some of the cost associated with that turnover may be avoidable by affecting those structural elements favorably. Two structural elements of an organization which have been conceptually and empirically associated with commitment, satisfaction and turnover intentions are (1) the promotion opportunities afforded the individual and (2) the perceived equity and fairness of the evaluation criteria used in the promotion and reward system. If these structural elements do exhibit significant linkages to internal auditor commitment, job satisfaction and turnover intentions then either or both may be used as tools to affect those outcomes and thereby reduce the costs of turnover and dissatisfaction. This study uses the process of path analysis to analyze the effects of satisfaction with promotion opportunities, satisfaction with promotion and reward evaluation criteria, organizational commitment, and job satisfaction on internal auditors' expressed desires to leave their current position (turnover intentions). This examination is conducted separately for a group of internal audit supervisors and a

group of internal audit non-supervisory professional staff personnel. This separation is suggested by the findings of prior studies that hierarchical position affects an individual's job perceptions (e.g., Aranya et al., 1982; Harrell et al., 1986). The following section of this paper discusses the prior studies and relevant conceptual and theoretical considerations pertinent to this study, and identifies the hypotheses which are examined here. That section is followed by a discussion of the means used to measure and gather the data and the process of path analysis used to analyze those data. The final two sections of this paper address, respectively, the results of the path analysis process and the conclusions and implications of this study far both practice and future research. Theoretical Considerations, Previous Research and Hypotheses Organizational commitment, job satisfaction and turnover intentions are related factors which have been extensively examined for a wide variety of categories of employees. However, the role of elements of promotion and reward system in relation to these factors has not been as widely examined. The following section outlines conceptual and empirical considerations in relation to these three factors and discusses how elements of the promotion and reward system (specifically promotion opportunities and evaluation criteria used) may be related to them. Organizational Commitment, Job Satisfaction and Turnover Intentions Organizational commitment is considered a "complex, affective response that employees develop in their employment situations" (Baack et al., 1995: 233). Organizational commitment involves the strength of an individual's identification with and involvement in an organization. Organizational commitment is associated with factors such as: (1) a strong belief in and acceptance of the organization's goals and values; (2) a willingness to exert considerable effort on behalf of the organization; and (3) a definite desire to maintain organizational membership (Porter et al., 1974). In examining the organizational commitment of accountants Aranya and Ferris (1984) report that organizational commitment has a direct(1) positive effect on job satisfaction and a direct inverse effect on migration tendencies (e.g., turnover intent) in both public accounting and in industrial organizations. In the case of internal auditors Harrell, Chewning and Taylor (1986) report that organizational commitment has a direct positive affect on job satisfaction but no direct effect on turnover intentions. Job satisfaction, as described by Parker, Ferris and Otley "refers to the positive feelings and opinions that one holds in response to the appraisal of one's job or job experiences" (1989: 12). If the individual's appraisal of his or her job leads to a low level of satisfaction (i.e., job dissatisfaction) then a process may begin which can eventually result in turnover. Studies of accountants in both public accounting and in industry consistently report the presence of an inverse relationship between job satisfaction and turnover intent (e.g., Gregson, 1990; Harrell and Stahl , 1984; Snead and Harrell, 1991). In the case where the attitudes of internal auditors were specifically examined Harrell et al. (1986) report a significant direct inverse relationship between job satisfaction and turnover intent. When members of the accounting profession are the subject of investigation, the desire to leave one's current position (i.e., turnover intent) as well as actual turnover are both reported as outcomes linked to job satisfaction and organizational commitment. As suggested by Gregson (1990) a model of accountants' turnover intentions should include both job satisfaction and organizational commitment as antecedent factors affecting those intentions. The results of the prior research and the conceptual considerations relating to organizational commitment, job satisfaction and turnover intentions lead to the following hypotheses which are examined in this study. [H.sub.1]: There is a direct inverse relationship

between the internal auditor's level of job satisfaction and turnover intentions. [H.sub.2]: There is a direct inverse relationship between the internal auditor's level of organizational commitment and turnover intentions [H.sub.3]: There is a direct Positive relationship between the internal auditor's level of organizational commitment and the level of job satisfaction. Promotion Opportunities and Evaluation Criteria Used Some of the attributes and factors which affect commitment, job satisfaction and turnover intentions are personal in nature (e.g., age, tenure, education level) and can be altered or affected only slightly if at all by any organizational actions. Other attributes and factors affecting these outcomes, however, may be related to policies, procedures and structures which are under direct organizational control. One such structural element is the promotion and reward system used to evaluate and reward individuals. Mowday, Porter and Steers (1982: 126) identify the organization's promotion policies as one of the characteristics that have an effect on the individual's affective responses such as organizational commitment and job satisfaction. Lawler (1973) indicates that the data from a number of studies show that problems or concerns with promotion are factors that provide a major source of dissatisfaction for employees. Rhode, Sorensen and Lawler (1977) report that for accountants in public practice who voluntarily left their positions, uncertainty surrounding evaluated performance is a frequently cited attribute contributing to that departure. While there are a number of important elements in the promotion and reward system, two aspects which directly affect the individual are promotion opportunities and the evaluation criteria used by the system. London (1983) and also Rhodes and Doering (1983) identify the presence of a career path leading to a series of promotions and new positions as an important extrinsic reward affecting the individual. Super and Minor (1987) report that career development and satisfaction with career paths significantly affect an individual's commitment and job satisfaction. Curry, Wakefield, Price and Mueller (1986) report that promotion opportunity has a statistically significant positive effect on organizational commitment. Thus, an individual who is dissatisfied with the promotion opportunities afforded him or her in the internal audit function may be expected to exhibit behaviors and outcomes such as decreased commitment, reduced satisfaction with the job, and the development of a desire to leave the internal audit function. Szilagyi and Wallace (1990) report that the critical role of perceived fairness and accuracy in the performance evaluation process is supported by a number of empirical studies (e.g., Landy et al., 1980; Landy and Trumbo, 1985; Ilgen and Feldman , 1985). Greenberg (1987) describes a number of theories which involve the relationship between the individual and the perceived fairness of the reward system. That fairness may involve fairness of the

outcome (i.e., distributive justice) or fairness of the procedures used to determine the outcome (i.e., procedural justice). While distributive justice focuses on the outcome and therefore may involve the application or interpretation of the criteria used in the reward system, procedural justice focuses on the procedures used to determine the outcome. Under the concepts of procedural justice theory, inequity or unfairness in the evaluation criteria used in the promotion and reward system will lead the individual to express dissatisfaction with those criteria. That dissatisfaction may contribute to such outcomes as reduced commitment, job dissatisfaction and the desire to leave the firm. The impact of fairness and equity in evaluation criteria is supported by the findings of Hurka (1983) that for the accountants in his study the most important occupational need was to be evaluated fairly. Given these findings and the concepts involved in the theory of procedural justice, the internal auditor's degree of satisfaction with the evaluation criteria used in the promotion and reward system may be a factor which affects commitment, satisfaction and turnover intent. These theoretical considerations and the results of previous research involving the promotion and reward system lead to the following hypotheses which are examined in this study: [H.sub.4]: There is a direct positive relationship between the internal auditor's satisfaction with the promotion opportunities afforded him or her within the internal audit department and his or her level of job satisfaction. [H.sub.3]: There is a direct positive relationship between the internal auditor's satisfaction with the promotion opportunities afforded him or her within the internal audit department and his or her level of organizational commitment. [H.sub.6]: There is a direct positive relationship between the internal auditor's satisfaction with the criteria used for evaluations in the internal audit department's

promotion and reward system and his or her level of job satisfaction. [H.sub.7]: There is a direct positive relationship between the internal auditor's satisfaction with the criteria used for evaluations in the internal audit department's promotion and reward system and his or her level of organizational commitment. Proposed Model Figure I graphically represents the hypothesized model examined in this study. In that figure the lines connecting the various elements of the model indicate the particular hypothesized direct relationship between the two elements thus connected. As indicated in Figure I, turnover intentions is considered as the final outcome of the model and assumed to be directly affected inversely by both organizational commitment and job satisfaction. Job satisfaction, in turn, is directly affected, hypothetically, in a positive manner by organizational commitment, satisfaction with promotion opportunities and satisfaction with evaluation criteria. Organizational commitment, as shown in Figure I, is directly affected in the model in a positive fashion by satisfaction with both promotion opportunities and the evaluation criteria used. [ILLUSTRATION OMITTED] The causal ordering of organizational commitment and job satisfaction in a model of turnover intentions is subject to some degree of debate. As indicated by Gregson (1992) the causal ordering of these variables has received abundant attention in non-accounting settings. Gregson (1992) indicates that for the models of accountants in his study, the model with job satisfaction as an antecedent variable to organizational commitment is slightly superior. However, in order to remain consistent with the previous study addressing these particular variables in relation to internal auditors (i.e., Harrell et al., 1986) the model proposed in the current study assumes organizational commitment is an antecedent of job satisfaction. Research Methodology Research Sample The members of three chapters of the Institute of Internal Auditors participated in this study. Of 359 questionnaires mailed, 223 were returned. Of the questionnaires returned, 126 represented responses from individuals who were currently engaged in the practice of internal auditing as supervisors or as staff level auditors (64 internal audit supervisors and 62 non-supervisory professional staff level auditors) from firms in the manufacturing, retail, financial, transportation and service industries. Table 1 provides demographic data concerning the respondents. Table 1 Attributes of Respondents

Supervisors Average length of services in the internal audit department Average age Percentage married Percentage with one or more professional certifications [Illegible Text] 6.1 years 29.8 years 67.0% 64

Staff Auditors 3.2 years 28.5 years 61.0% 62

Variable Measures In a manner similar to the previous studies of accountants (e.g., Aranya et al., 1982; Bline et al., 1991; Harrell and Stahl, 1984; Snead and Harrell, 1991; Gregson, 1990; Senatra, 1980; Sorensen, 1967) this study used a single item to measure turnover intentions. This item, taken from Hoppock's (1935) Job Satisfaction Measure, is identical to that used in the previous study involving internal auditors (Harrell et al., 1986) and required the individual to agree or disagree with one of seven statements on a scale ranging from "I would quit this job at once if I could" to "I would not exchange my job for any other." Also in order to remain consistent with the previous studies involving internal auditors in particular (i.e., Harrell et al., 1986) and accountants in general (e.g., Bline et al., 1991), job satisfaction was measured in this study with a single item taken from Hoppock (1935). This item required participants to respond to the question of "which of the following shows how much of the time you feel satisfied with your job" on a seven point scale ranging from 1 = Never to 7 = All of the time. The individual's commitment to the organization was measured in this study by the scale developed by Porter et al. (1974) and adapted by Aranya, Pollock and Amernic (1981) and Aranya and Ferris (1984). The nine item "short form" of the scale was used in accordance with the suggestions of Mowday et al. (1982: 229) in a manner similar to Currey et al. (1986). Cronbach's (1951) alpha measuring the internal consistency of the nine item scale for the present study is .89 for organizational commitment, which compares favorably to the alpha from the Harrell et al. (1986) study of .90. To determine the individual's level of satisfaction with his or her promotion opportunities, the respondent was asked to indicate agreement or disagreement on a seven point Likert scale (1 = Strongly Agree, 7 = Strongly Disagree) with the statement "I am satisfied with the promotion opportunities afforded me within the internal audit department." The individual internal auditor's satisfaction with the promotion and reward criteria used in the organization was measured by asking the individual to express agreement or disagreement (on the Liken scale) with the statement "I am satisfied with the criteria used in the internal audit department's promotion and rewards system in order to evaluate individuals." Data Analysis Path analysis (Asher, 1983) is used to examine the date in this study and to test the relationships hypothesized in the model depicted in Figure 1. The process of path analysis involves a series of multiple regressions (in this case, three) with the dependent variable and the set of independent variables being systematically changed as the process "moves from right to left" in the model. Therefore, the initial regression involves using turnover intentions as the dependent variable with all of the other model variables being used as independent variables in the regression. The next regression in the series

involves the elimination of turnover intentions as a variable, the use of job satisfaction as the dependent variable, and the use of the remaining variables as the set of independent variables to be tested for their direct relationship, if any, to job satisfaction. As indicated by Snead and Harrell the premise of the path analysis process is that the association of a statistically significant standardized beta weight with an independent variable implies that "when the effects due to the other independent variables have been controlled for, that independent variable directly influences the dependent variable" in question (1991: 89). The potential existence of multicollinearity in the path analysis process was examined in the present study by the same process followed by Snead and Harrell (1991) based on the suggestions of Myers (1988). The general belief, according to Myers (1986), is that if any VIF exceeds a value of 10 there is some reason for concern in regard to multicollinearity. In the present study the VIF values ranged from 1.00 to 1.20. These values indicate, therefore, that multicollinearity is not a problem in the data analyzed here. The path analysis process as outlined above will identify any significant direct relationship between a given independent variable and a particular dependent variable even if that relationship was not specifically hypothesized in the proposed model. For example, when turnover intentions is serving as the dependent variable, each of the other variables included in the model is included in the regression even if a particular independent variable (e.g., satisfaction with promotion opportunities) is not hypothesized to have a direct effect on turnover intentions. Therefore, any unanticipated or "ancillary" relationships which do exist will be identified even though they were not hypothesized. The path analysis process also provides an indication of any indirect effect which a particular variable may have on a dependent variable. For example, a given variable, A, may have a direct effect on variable B. If A also has a direct effect on a third variable, C, which also directly affects B, then variable A has an indirect effect on B coming through its effect on C and C's effect on B. This relationship is shown graphically as follows: [ILLUSTRATION OMITTED] where [B.sub.1] is the value of the standardized beta linking the two variables in question. Therefore, the total effect of A on B would be the sum of the direct effect of A on B and the indirect effect of A on B through C. This total effect would be calculated by the expression: Total Effect = [B.sub.1] + ([B.sub.2] x [B.sub.3]) Results The data for each group of respondents, supervisors and staff level auditors were examined using separate path analyses. Hypothesis testing using the path analysis process involves the examination for the presence of a statistically significant standardized beta value between each independent variable and dependent variable in question. The significant direct relationships indicated by the data are graphically illustrated in Figure II for supervisors and in Figure III for staff level auditors. Table 2 shows the path coefficients and statistical significance of each of the hypothesized relationships tested for supervisors and staff. For staff level auditors Table 2 also includes a significant ancillary or unanticipated direct relationship which was indicated by the path analysis process. The data for neither supervisors nor staff members indicated support for [H.sub.2] concerning a direct relationship between organizational commitment and turnover intentions. Likewise the data for neither group indicated support for [H.sub.6] concerning a direct relationship between job satisfaction and satisfaction with the evaluation criteria used. [ILLUSTRATIONS OMITTED] Table 2

Significant Relationships Regression Model Hypothesis # Relationship F Sig. Level [R.sup.2]

INTERNAL AUDIT SUPERVISORS: [H.sub.1] [H.sub.2] [H.sub.3] [H.sub.4] [H.sub.5] [H.sub.6] [H.sub.7] Turnover - Job Satisfaction Turnover - OC Job Satisfaction - OC Job Satisfaction Promotion Opportunities OC - Promotion Opportunities Job Satisfaction Evaluation Criteria OC - Evaluation Criteria 51.5 51.5 42.0 42.0 10.6 42.0 10.6 .0000 .0000 .0000 .0000 .0018 .0000 .0018 .45 .45 .58 .58 .15 .58 .15

STAFF LEVEL INTERNAL AUDITORS: [H.sub.1] [H.sub.2] Turnover - Job Satisfaction Turnover - OC 11.0 11.0 .0001 .0000 .27 .27

Ancillary Relationship: Turnover - Satisfaction With Evaluation Criteria [H.sub.3] [H.sub.4] [H.sub.5] [H.sub.6] [H.sub.7] Job Satisfaction - OC Job Satisfaction Promotion Opportunities OC - Promotion Opportunities Job Satisfaction Evaluation Criteria OC - Evaluation Criteria

11.0 23.5 23.5 10.2 23.5 10.2

.0000 .0000 .0000 .0023 .0000 .0023 Relationship

.27 .44 .44 .15 .44 .15

Hypothesis #

Relationship

Beta Weight

Sig. Level

INTERNAL AUDIT SUPERVISORS: [H.sub.1] Turnover - Job Satisfaction .674 -7.177 .0000

[H.sub.2] [H.sub.3] [H.sub.4] [H.sub.5] [H.sub.6] [H.sub.7]

Turnover - OC Job Satisfaction - OC Job Satisfaction Promotion Opportunities OC - Promotion Opportunities Job Satisfaction Evaluation Criteria OC - Evaluation Criteria

n/s +.453 +.463 +.382 n/s n/s

-0.864 +5.035 +5.150 +3.260 +1.578 +1.072

n/s .0000 .0000 .0018 n/s n/s

STAFF LEVEL INTERNAL AUDITORS: [H.sub.1] [H.sub.2] Turnover - Job Satisfaction Turnover - OC .299 n/s -2.460 -1.110 .0168 n/s

Ancillary Relationship: Turnover - Satisfaction With Evaluation Criteria [H.sub.3] [H.sub.4] [H.sub.5] [H.sub.6] [H.sub.7] Job Satisfaction - OC Job Satisfaction Promotion Opportunities OC - Promotion Opportunities Job Satisfaction Evaluation Criteria OC - Evaluation Criteria

-.321 +.373 +.430 n/s n/s +.381

-2.639 +3.562 +4.111 +1.245 -0.527 +3.190

.010 .0007 .0001 n/s n/s .0023

OC = Organizational Commitment

Direct Effects on Turnover Intentions As shown in Figures II and III, for both supervisors and staff level auditors there is a direct inverse relationship between job satisfaction and turnover intentions which supports [H.sub.1]. This is consistent with previous research findings (e.g., Harrell et al., 1986). However, for staff level auditors, there is an additional direct effect on turnover intentions coming from the individual's degree of satisfaction with the evaluation criteria used for promotion and reward purposes. This latter direct relationship was not hypothesized by the model in Figure I but was revealed by the path analysis process. Direct Effects on Job Satisfaction For both supervisors and staff level auditors, as shown in Figures II and III, job satisfaction is directly affected by both organizational commitment and satisfaction with promotion opportunities, thus supporting [H.sub.3] and [H.sub.4]. This positive relationship between organizational commitment and

job satisfaction is consistent with the positive relationship between those two factors reported in studies by Bateman and Strasser (1984), Castleberry and Tanner (1987), and Weiner and Gechman (1977). The direct positive relationship indicated for both groups between job satisfaction and satisfaction with promotion opportunities is consistent with the concept that extrinsic rewards, such as promotion, affect satisfaction and is consistent with the findings of the studies examined by Lawler (1973) which report that promotion is a major factor affecting job satisfaction. Direct Effects on Organizational Commitment The factors which have a direct effect on organization commitment in this study differ between supervisors and staff level auditors. For supervisors the data support [H.sub.5] and indicate that satisfaction with promotion opportunities directly affects organizational commitment. However, for staff level auditors the data support [H.sub.7] and indicate that satisfaction with the evaluation criteria used is the sole factor directly affecting organizational commitment for that group. These diverse findings are consistent with the suggestions of Kanfer (1991) based on a number of organizational socialization models. Those suggestions are that new employees (such as staff auditors) are highly concerned with promotion criteria due to their focus on fitting in, learning the performance evaluation ropes and publicly demonstrating their competence. More seasoned employees such as supervisors, however, are more familiar with the performance evaluation process and are more likely to be concerned with organizationally dispensed rewards such as promotion. Indirect Effects on Commitment, Job Satisfaction and Turnover Intentions There are a number of indirect effects on turnover intentions which are evident from the examination of the data in this study. Table 3 demonstrates the calculation of these indirect effects and the total effect (the sum of the direct effect and any indirect effects) which the various antecedent variables have on job satisfaction and turnover intentions. Table 3 Summary of Direct and Indirect Effects Explained by Each Model Path Variable INTERNAL AUDIT SUPERVISORS: Dependent Variable: Turnover Predictor Variables: Job Satisfaction Organizational Commitment Satisfaction With Promotion Opportunities Dependent Variable: Job Satisfaction Predictor Variable: Organizational Commitment Satisfaction With Promotion Opportunities Direct Effect Indirect Effect Total Effect

-.674 n/a n/a

n/a -.305 -.429

-.674 -.305 -.429

+.453 +.463

n/a +.173

+.453 +.636

Dependent Variable: Organizational Commitment Predictor Variable: Satisfaction With Promotion Opportunities +.382 STAFF LEVEL AUDITORS:

n/a

+.382

Dependent Variable: Turnover Predictor Variables: Job Satisfaction Satisfaction with Evaluation Criteria Organizational Commitment Satisfaction With Promotion Opportunities Dependent Variable: Job Satisfaction Predictor Variables: Organizational Commitment Satisfaction With Promotion Opportunities Satisfaction With Dependent Variable: Organizational Commitment Predictor Variable: Satisfaction With Evaluation Criteria

-.299 -.321 n/a n/a

n/a -.042 -.112 -.129

-.299 -.363 -.112 -.129

+.373 +.430 n/a

n/a n/a +.142

+.373 +.430 +.142

+.381

n/a

+.381

As shown in Figures II and III, organizational commitment has an indirect effect on turnover intentions for supervisors and staff members which comes through the path: Organizational Commitment [right arrow] Job Satisfaction [right arrow] Turnover Intentions. Also for both groups, satisfaction with promotion opportunities has an indirect effect on turnover intentions coming through the path: Satisfaction with Promotion Opportunities [right arrow] Job Satisfaction [right arrow] Turnover Intentions. However, for supervisors satisfaction with promotion opportunities has an additional indirect effect on turnover intentions derived along the path: Satisfaction with Promotion Opportunities [right arrow] Organizational Commitment [right arrow] Job Satisfaction [right arrow] Turnover Intentions. As indicated by Figure II, for supervisors the direct effect of satisfaction with promotion opportunities on job satisfaction is enhanced by an indirect effect coming through the path: Satisfaction with Promotion Opportunities [right arrow] Organizational Commitment [right arrow] Job Satisfaction. As shown for supervisors in Table 3 the combined direct and indirect effect (i.e., total effect) of satisfaction with promotion opportunities on job satisfaction is greater than the total effect which organizational commitment has on job satisfaction. As indicated in Figure III for staff level auditors, satisfaction with the evaluation criteria used in the promotion and reward system has an indirect effect on both turnover intentions and on job satisfaction from the path: Satisfaction with Evaluation Criteria [right arrow] Organizational Commitment [right arrow] Job Satisfaction [right arrow] Turnover Intentions. As shown for staff level auditors in Table 3, the total effect of satisfaction with evaluation criteria on turnover intentions is greater than the total effect on turnover intentions for any other variable in the model. Conclusions and Implications Before discussing the conclusions and implications of this study for both future research and for current practice, a few limitations should be mentioned. The data analyzed here were obtained from individuals who were available to respond as opposed to being obtained from a scientifically selected, random sample of the total population of internal auditors. In addition, a bias may be present due to the fact that all of the responses are from members of the Institute of Internal Auditors. However, the respondents do

represent a wide variety of industries and internal auditors who, even though they were not randomly selected, in most likelihood are representative of the population of internal auditors. Also, because this study involves cross-sectional as opposed to longitudinal data, no strict causal inferences are possible, The fact that a number of variables examined in this study were measured by single-item scales must be considered in interpreting the results and reaching the conclusions discussed in the following sections. Although the use of such single-item scales is consistent with the previous research involving accountants, that use does not permit examination of the reliability or validity of the single-item measures involved. However, as the outcomes of an exploratory examination, the findings presented here do provide potentially useful points of departure for further studies of internal auditors which overshadow these limitations. The results of this study are generally consistent with and support the results of previous research involving the various relationships between and among the variables of organizational commitment, job satisfaction and turnover intentions. However, when the two variables which are unique to this study (satisfaction with promotion opportunities and satisfaction with the evaluation criteria used) are considered, a number of new consequences and conclusions are evident which are pertinent for future research dealing with the development of models of internal auditor turnover intentions and job satisfaction. Satisfaction with promotion opportunities appears to be important to both groups as evidenced by its direct positive effect on job satisfaction and its resulting indirect effect on turnover intentions as shown in both Figures II and III. However, for supervisors, as shown in Figure II, satisfaction with promotion opportunities has not only a direct effect on job satisfaction but also an indirect effect on job satisfaction coming through the path: Satisfaction with Promotion Opportunities [right arrow] Organizational Commitment [right arrow] Job Satisfaction. For supervisors the various relationships combine to make satisfaction with promotion opportunities either directly or indirectly related to every other variable in the model. This suggests that satisfaction with promotion opportunities is a potential critical factor to be considered in a model of organizational commitment, job satisfaction and turnover intentions for internal audit supervisors. For staff level auditors satisfaction with the evaluation criteria used in the promotion and reward system has both a direct and an indirect effect on turnover intentions. As shown in Table 3 for that group the combined direct and indirect effects of satisfaction with evaluation criteria on turnover intent produce a total effect on turnover intent greater than that of job satisfaction. This suggests that satisfaction with the evaluation criteria used is a potential critical variable in a model of turnover intentions for staff level internal auditors. There are a number of practical implications suggested by the findings of this study. One implication is that satisfaction with promotion opportunities is a factor that should be considered by an organization in attempting to deal with or affect job satisfaction and turnover intentions for internal auditors. Based on the data in this study, internal auditors most likely will indicate increased job satisfaction and a reduced desire to leave their organization if they are satisfied with the promotion opportunities afforded them within the internal audit function. Any "cost" that may be associated with providing satisfactory promotion opportunities (e.g., increased performance monitoring costs, increased pay and benefits for individuals who are promoted and greater complexity due to the increased heirarchical structure required to support promotions) should be judged in relation to the benefits possible for increased job satisfaction and reduced turnover intentions. As a corollary, the "cost" of not providing satisfactory promotion opportunities within the internal audit function must include the potential adverse effects of reduced job satisfaction and increased turnover intentions. As indicated by the differences between the models for supervisors and for staff level auditors, satisfaction with promotion opportunities appears to play a more critical role for supervisors than for staff level auditors. The practical implication of this situation is that if an organization attempts through various means to reduce turnover intentions by increasing satisfaction with promotion opportunities, then the effect on turnover intentions for staff level internal auditors will not be as great as it is for internal audit supervisors.

Another practical implication suggested by the two models is that if an organization attempts to foster reduced turnover intentions by increasing the level of satisfaction with the evaluation criteria used in the promotion and reward system, there may be little or no effect on supervisors but a significant effect on staff level auditors. This finding is consistent with the models of organization socialization which suggest that the major focus of attention among newer employees such as staff level internal auditors is the performance criteria which will be used to evaluate their performance (Kanfer, 1991). The results of this study suggest that both satisfaction with promotion opportunities and satisfaction with the evaluation criteria used in the promotion and reward system should be factors to be considered in developing a model of internal auditor job satisfaction and turnover intentions. The results also suggest that staff level internal auditors and internal audit supervisors are subject to slightly differing sets of relationships when job satisfaction and turnover intentions are concerned. Although future research using a longitudinal approach, random selection and multiple-item scales is needed to fully validate the relationships reported here, the possibility that these relationships can affect job satisfaction and turnover intentions provides a potential basis for action in organizations seeking to improve the quality of their internal audit functions. Promotion opportunities and the evaluation criteria used are two factors which are under the direct control of the organization. If those two factors can be used to increase internal auditor job satisfaction and reduced turnover intentions, then organizations possess a tool which can be used to produce a beneficial outcome for both the organization and for the individual internal auditors involved. Improved job satisfaction and reduced turnover intentions should benefit the organization from the standpoint of increased effectiveness of the internal audit department. That increased effectiveness may allow the independent auditors to rely to a greater extent on work performed by internal auditors (an outcome that may affect the costs of the independent audit). Improved job satisfaction and a decreased desire to leave their current position should benefit individual internal auditors by improving the way in which they view and accomplish their work and their attitude toward both their responsibilities and their organizations. (*) The author would like to acknowledge the comments and contributions of two anonymous reviewers and the Editor. (1) A direct relationship exists between two variables, X and Y, when no other variable acts as an intervening variable between them. See the Data Analysis section for a full description of direct versus indirect relationships. References American Institute of Certified Public Accountants. 1991. Statement on Auditing Standards No. 65: The Auditor's Consideration of the Internal Audit Function in an Audit of Financial Statements. New York, NY: AICPA. Aranya N., J. Pollock, and J. Amernic. 1981. "An Examination of Professional Commitment in Public Accounting." Accounting Organizations and Society 6: 271-280. --, and K. R. Ferris. 1984. "A Reexamination of Accountants' Organizational-Professional Conflict." The Accounting Review 59: 1-15. --, R. Lachman, and J. Amernic. 1982. "Accountant's Job Satisfaction: A Path Analysis." Accounting, Organizations, and Society 7: 201-215. Asher, H.B. 1983. Casual Modeling. Beverly Hills, CA: Sage Publications. Baack, D., F. Luthans, and J. Rogers. 1993. "Analysis of the Organizational Commitment of Clergy Members." Journal of Managerial Issues V (2): 232-253. Bamber, E. 1993. "Opportunities in Behavioral Accounting Research." Behavioral Research in

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