SYCHOLOGICAL CONTRACT AND JOB PERFORMANCE OF AUDIT TRAINEES OF SELECTED INTERNATIONAL AUDIT FIRMS IN SRI LANKA

Abstract

Even though the impact of psychological contract to several job related outcomes is well documented, less attention has been drawn to check the relationship between psychological contract and job performance, especially in the Sri Lankan context. The main purpose of this study is to identify whether there is a positive relationship between the contents of the psychological contract and job performance of audit trainees who have engaged in international audit firms. Further, the current study was designed to identify the relationships of transactional contract and relational contract on the job performance of audit trainees. This is cross-sectional descriptive research in nature. A standard questionnaire was used to collect primary data through a survey. The respondents were the audit trainees those who are working for international audit firms, selected from four international audit firms operating in Sri Lanka. Descriptive statistics, t-tests and one- way ANOVA was used to analyze the data and to make conclusions. Findings discovered that the contents of a psychological contract have a significant positive relationship with the job performance of audit trainees. Further, it was revealed that both transactional and relational contracts also have positive relationships with the job performance of audit trainees in international audit firms. Finally, it is concluded that psychological contract has a strong positive significant relationship with audit trainees’ job performance and further, it is concluded that the relational contract has a major impact on the job performance of audit trainees than transactional contract. It is suggested that audit firms may address the requirements and expectations of the trainees in order to attain high performance. Cross validation of the findings of this study to be done in different industries and cultures comparatively a bigger sample in these subsequent studies are recommended, which will add more insights to the substance of the present study.