Relational contracting theory and internal audit: Chief audit executives' perspectives on creating and strengthening trust by building credibility and clarity

Using the lens of relational contracting, we examine internal auditors' efforts in building a relationship trust with management within context operational audits. We gain insights into day‐to‐day practices auditors by interviewing 28 chief audit executives departments across Australia and find that undertake numerous measures to demonstrate credibility provide clarity on their intentions an attempt managements' respect confidence. However, also some defensive corporate culture support notion ‘trust begets trust’. Consequently, such may not only assist establishing contract but highlight potential risks auditor independence.