How does feeling like part of an organization influence internal and external auditors' judgments?

What is it about?

The extent to which one feels connected to an organization is called Organizational Identification. It is possible that auditors (both internal and external) could jeopardize their decision-making if they feel too close to their client/employer. We find that while internal auditors feel more Organizational Identification towards their employers than external auditors do towards their clients, we find an inverse reaction to the identification. As internal auditors identify more with their employer, their judgments get more conservative, but as external auditors identify more with their clients, their judgments get more lax.

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Why is it important?

Internal auditors are often seen as less independent than external auditors, but we identify a characteristic that could challenge who actually more independent.