Ideological psychological contracts and performance outcomes: the role of work meaningfulness

This paper contributes to the auditing literature by developing a theoretical model that examines the auditor–audit firm relationship from a psychological contract perspective. Specifically, this paper examines how ideological psychological contract (IPC) fulfillment is associated with auditors’ intentions to engage in skeptical actions and organizational citizenship behavior (OCB). This study hypothesizes that work meaningfulness mediates the relationships between IPC fulfillment and auditors’ intentions to engage in skeptical actions, and between IPC fulfillment and OCB. The theoretical model was tested by conducting a two-wave online survey involving 250 auditors in the Philippines, along with an ex-ante procedural remedy and an ex-post test to mitigate common method bias. Findings show that IPC fulfillment reinforces auditors’ perceived work meaningfulness, which then motivates them to form greater intentions to engage in skeptical actions and OCB. By invoking psychological contract theory, this study provides additional insights into how auditor–audit firm relationships anchored on ideologies reinforce aspects of auditor performance that can contribute to firms’ audit quality initiatives. The findings of the study have implications for audit firms, regulators, standard setters, and researchers.