AUDITOR-CLIENT NEGOTIATION STRATEGIES IN SOLVING CONTENTIOUS ACCOUNTING ISSUES

Abstract

Negotiation is one of the methods for problem solving. The negotiation strategy comprises both competition and mutual-gains situations, otherwise termed as distributive and integrative. Each of the strategy has their own tactics and approaches. Distributive strategy comprises of contending, accommodating and concession. Otherwise, integrative strategy comprises of collaboration and compromising. Auditors have a different perception for choosing the best strategy that depends on the conditions and outcomes. Therefore, this study seeks to investigate the negotiation strategy employs by auditors during negotiation. Specifically, this study provides 15 questions that characterize the negotiation strategy. This study employs 88 experienced auditors from small and medium sized firms located in the East Coast of Malaysia. This study was using SPSS 18 to make descriptive statistics in order to find the frequency for each tactic. The results show that external auditors preferred concession tactics during negotiation in resolving the contentious issues