Accountin~ OrganizationsandSociety, Vol. 17,No. 6,pp 535-547, 1992 0361-3682/92 $5 00+.00 Printed in Great Britain Pergamon Press Ltd

A N E M P I R I C A L E X A M I N A T I O N O F S T R E S S I N P U B L I C A C C O U N T I N G *

KAREN M. COLLINS

Lehigh Universi ty

and

LARRY N. KILLOUGH

Virginia Po ly techn ic Ins t i tu te a n d State Universi ty

Abstract

This paper presents the results of an investigation of stress in public accountmg~ using a national sample of certified public accountants The relationship between a set of predictor variables ( organizational stressors and work/home conflict) and a set of criterion variables (job-related tenston, job dissatisfaction, and propensity to leave public accounting) was athalyzed usmg canonical correlation analysis. Job-related tension was assooated vclth heavy work demands; lob dissatisfaction and retention to leave were associated with slow career progress, unfulfillirtg jobs, arid unclear job objectives.

Publ ic a c c o u n t i n g is genera l ly r ega rded as a

stressful o c c u p a t i o n (Weick , 1983; Figler,

1980). Al though no t all stress is bad (Selye,

1974), excess ive stress can have negat ive

c o n s e q u e n c e s for b o t h the individual and the

organiza t ion (Mat t e son & Ivancevich , 1982;

Cooper , 1981; Cox, 1978). Several r esearchers have investigated determinants and consequences

o f stress in pub l i c account ing . Haskins et aL

( 1 9 9 0 ) e x p l o r e d the re la t ionship b e t w e e n

stress and audi tors ' psycholog ica l symptoms of

anx ie ty and depress ion. Rebe le & Michaels

( 1990 ) , Bamber et aL (1989) , K e m e r y et aL (1985) , and Senatra ( 1 9 8 0 ) s tud ied an t eceden t s

tO and/or c o n s e q u e n c e s o f accountan t s ' ro le

stress. C h o o ( 1 9 8 6 ) inves t iga ted the associat ion

b e t w e e n stress and audi tors ' job pe r fo rmance .

With the e x c e p t i o n o f the Haskins et al.

( 1 9 9 0 ) study, n o n e of this past r esearch

has e x a m i n e d a b road range o f po ten t ia l

organizat ional sources o f stress. N o r have factors

ex te rna l to the organizat ion, such as confl ic t

b e t w e e n w o r k and non-work activities, b e e n

explored . 1 This pape r ex t ends p r io r research by

r epor t ing the resul ts o f an ex tens ive s tudy of

stress in publ ic accoun t ing using a large, nat ional

sample o f cer t i f ied pub l ic accountants . 2 The

pu rpose o f the s tudy was to assess the relat ion-

* The authors gratefully acknowledge the helpful comments from James A Largay lII, James E. Rebele, and two anonymous referees on earlier drafts of this manuscript. Fmancial support was provided in part by the Radford University Foundation.

1 Although the Haskins et aL study (1990) also investigated a broad range of stressors, the stress outcomes investigated are different Haskms etaL examined the relationshxp between a group of stressors and the psychological symptoms of anxiety and depression, whereas this study explored the association between a set of stressors and job-related tension, job dissatisfaction, and intention to leave public accountingy

2 with the exception of the research by Kemery et aL ( 1985 ), none of the other studies mentioned has surveyed a natmnal sample of CPAs from all functional areas. Samples have been limited to auditors from one or several large, international firms (Haskins et aL, 1990; Rebele & Michaels, 1990; Bamber et aL, 1989; Senatra, 1980) or one geographical area (Choo, 1986)

535

536 K. M. COLLINS and L N KILLOUGH

ship between a set of organizational and extraorganizational stressors and the following stress outcomes: job-related tension, job dis- satisfaction, and intention to leave public accounting. In the following sections, back- ground information is provided, the empirical investigation is described, and the significance of the results for CPAs and accounting firms is discussed.

STRESS AND ITS CONSEQUENCES

According to McGrath (1976, p. 1352), "stress involves an interaction of person and environment ... There is a potential for stress when an environmental situation is perceived as presenting a demand which threatens to exceed the person's capabilities and resources for meeting it, under conditions where he expects a substantial differential in the rewards and costs from meeting the demand versus not meeting it". Several important points are embedded in this definition. First, the extent to which a demand made upon a person is stressful depends on whether it is perceived as stressful by the individual. This interactional approach emphasizes that stress is an individual per- ceptual phenomenon (Cox, 1978). Second, the individual must perceive that the consequences of meeting the demand are substantially more desirable than the consequences of not meeting it. Thus, there is individual variation in the perception of the ability and importance of meeting a demand (Schuler, 1980). Third, because stress results from a demand/capability imbalance, an underload of environmental demand may be just as stressful as an overload (Bailey & Bhagat, 1987).

Stressors

A stressor is something in the environment which presents a person with "a demand, or a constraint, or an opportunity for behavior" (McGrath, 1976, p. 1352). Virtually any event, situation, or person can be a stressor (Matteson & Ivancevich, 1987). Focusing on the work environment, various researchers have developed

categorizations of work-related stressors (Quick & Quick, 1984; Ivancevich & Matteson, 1983; Burke, 1988). Although each categorization tends to be unique, there is some overlap among the groupings, in terms of both the categories selected and the stressors included within each category. Quick & Quick (1984), for example, divide work stressors into four categories: (1 ) task demands, or the nature of the work itself; (2) role demands, or the organizational role assumed by the individual; (3)physical demands, or elements in the physical environment; and (4) interpersonal demands, or stressors occur- ring due to individuals working together and interacting on a regular basis. Burke (1988) expands this grouping by adding two additional categories - - career development pressures, and extraorganizational stressors, specifically work-family conflict.

Ivancevich & Matteson (1980) also recognize the need to consider extraorganizational stressors when examining work-related stress. In addition to extraorganizational stressors, Ivancevich & Matteson (1987) identified 15 work-related dimensions that they divide into two main groups of stressors. One group, consisting of "macro stressors", refers to stressors operating at the organizational level and includes factors unique to the organization, such as organizational structure and the reward system. The other group, labelled "micro stressors", refers to stressors operating at the individual level and includes factors associated with the tasks to be accomplished or the role played by an individual in the organization. This study investigates these micro-level stressors, along with extraorganizational sources of stress.

Stress o u t c o m e s

Although a certain amount of stress is essential to well being (Selye, 1978), excessive stress can be dysfunctional and result in negative con- sequences (Ivancevich & Matteson, 1980). Cox (1978) developed a taxonomy of potential stress consequences. These consequences, and examples of each, follow: ( 1 ) subjective effects: anxiety, irritability, depression; (2) behavioral effects: excessive drinking and smoking, drug

STRESS IN PUBLIC ACCOUNTING 537

STRESSORS

Organizational

Role Ambiguity Role Conflict

Quantitative Overload Qualitative Overload

career Progress Responsibility for People

Time Pressure Job Scope

Extraorganizational

Work/Home Conflict

STRESS OUTCOMES

Job-Related Tension

Job Dissatisfaction

Propensity to Leave Public Accounting

Fig 1. Model of interrelanonsfups among the variable sets

use; ( 3 ) cogn i t i ve effects: inabi l i ty to make dec is ions , f r e q u e n t forgetfulness; ( 4 ) phys io- logical effects: i n c r e a s e d hea r t ra te and h igh b l o o d p re s su re ; ( 5 ) hea l th effects: c o r o n a r y h e a r t disease, headaches , u lcers ; ( 6 ) organiza- t ional effects: j ob dissat isfact ion, p o o r p roduc t iv i ty , h igh tu rnover .

It c a n n o t b e c o n c l u d e d that these con- s e q u e n c e s are always, o r even f requent ly , the resu l t o f stress. Cer ta inly , c o n s e q u e n c e s such as anxie ty , h igh b l o o d p res su re , j ob dissa t is fac t ion and t u r n o v e r can resu l t f rom m a n y factors. Never the less , t he l i ke l i hood tha t s t ress m a y b e the p r i m a r y o r c o n t r i b u t i n g cause of these c o n s e q u e n c e s c a n n o t b e d i s r e g a r d e d ( I v a n c e v i c h & Mat teson , 1980). This s tudy focuses on a l imi t ed n u m b e r o f s t ress con- s equences : j ob - r e l a t ed tens ion , j ob dissatis- fact ion, and p r o p e n s i t y to leave p u b l i c account ing .

THE STUDY

The m o d e l used to gu ide the s tudy o f the re la t ionsh ips b e t w e e n s t ressors and s t ress o u t c o m e s is p r e s e n t e d in Fig. 1. This m o d e l is an adap ta t ion and s impl i f ica t ion o f severa l s imi lar concep tua l i za t i ons (F le tcher , 1988; Mat te son & Ivancevich , 1987; Cox, 1978). 3

The m o d e l consis ts o f two parts : ( 1 ) s t ressors , o r the a n t e c e d e n t s to t he s t ress s i tuat ion, and ( 2 ) s t ress o u t c o m e s , o r t he c o n s e q u e n c e s o f the s t ressors . The m o d e l r ecogn ize s that s t ressors and o u t c o m e s are l inked b y f e e d b a c k mechan- isms. For example , job dissa t is fac t ion ( an o u t c o m e ) m a y affect h o w a p e r s o n in te rac t s w i t h his o r h e r c o -w orke r s ( a s t ressor ) .

Sample A nat iona l s amp le o f e x p e r i e n c e d p u b l i c

a c c o u n t i n g firm e m p l o y e e s was o b t a i n e d

3 The model is not fully specified. In fact, only a subset ofpotenttal stressors and outcomes is included in the model. Given the ,mpracticahty of investigating a large number of variables, this study includes only a select number of variables of potential relevance to the public accounting environment.

538 ~ M. COLLINS and L. N. KILLOUGH

through the cooperation of the American Institute of Certified Public Accountants (AICPA). The sample consists of 1593 individuals classified by the AICPA as being employed at the senior or manager level in their firms. 4 Senior staff accountants and managers are particularly valuable to a public accounting firm. They maintain close contact with clients, often serving as the primary interface between the client and the firm. They also supervise subordinates and thus are crucial to the development of personnel within the firm.

Data were collected through questionnaires mailed to the sample group. The initial mailing of the questionnaires was followed three weeks later by a second request. Of the 1593 indivi- duals surveyed, 1011 (63%)responded . 5 Fifty- five respondents were subsequently dropped from the analysis because they held positions at other than the senior or manager level, reducing the final sample size to 956 individuals. These individuals have an average tenure in the profession of five years and nine months. Forty-one percent hold positions as senior staff accountants and 59% hold positions as managers. Sixty-seven percent are males and 33% are females.

Variables a n d measures Stressorg The organizational stressors shown

in Fig. 1 relate to tasks to be accomplished or roles to be played in an organization. These stressors are measured using Ivancevich & Matteson's Stress Diagnostic Survey (1983), a comprehensive self-report measure of per- ceived job-related stress. The Stress Diagnostic Survey contains 32 items and was designed to be used with managerial employees who, like public accounting seniors and managers, have some degree of autonomy. Separate scores are obtained for each of the eight categories of work-related stressors: role ambiguity, role

conflict, quantitative work overload, qualitative work overload, career progress, responsibility for people, time pressure, and job scope.

When evaluating stress, it is important to consider not only organizational sources of stress but extraorganizational sources as well. A major problem facing individuals appears to be conflict between work life and home life (see Kabanoff, 1980; Near et al., 1980; Staines & O'Connor, 1980, for reviews of the literature in this area). Conflicts result when the work schedule severely limits free time or makes the individual too tired or irritated to enjoy other activities (Pearlin & Turner, 1987; Mortimer & Sorensen, 1984; Pleck et aL, 1980; Staines & O'Connor, 1980). Several prior studies suggest that accountants experience conflict between their jobs and their home lives (Earnest & Lampe, 1982; Knapp, 1980; Istvan & Wollman, 1976; Rhode et al., 1977; White & Hellriegel, 1973). Conflict between work and home life is measured using four items from Kopelman et

al. s' (1983) interrole conflict scale. An example of an item from this scale is: "After work, I come home too tired to do some of the things I would like to do".

Stress outcomes. The stress outcomes inves- tigated are job-related tension, job dissatis- faction, and propensity to leave public accounting. Job-related tension is measured by the job-induced tension scale developed by House & Rizzo (1972), and used by Senatra (1980). The scale was designed to measure "the existence of tensions and pressures growing out of job requirements, including possible outcomes in terms of feelings or physical symptoms . . . . Some measures of 'taking the job home' .. were also included" (House & Rizzo, 1972, pp. 481-482) . Examples from the scale are: "My job tends to directly affect my health" and "Problems associated with my job have kept me awake at night".

4 Individuals at the senior level have responstbihty for planning and conducting engagements. Those at the manager level have responsibihty for overseeing a number of engagements and supervising senior-level employees (AICPA, 1981 )

5 A 50% response rate is generally considered adequate for the analysis and interpretation of questionnaire data (Babbie, 1989 )

STRESS IN PUBLIC ACCOUNTING

TABLE 1 Descrtptive statistics and reliabilities of variables (iV -- 956) °

539

No. of items Item Variable in scale range Mean1" S D., Reliability§

Organizattonal stressors Role ambiguity 4 1-7 3.19 1 11 0.80 Role conflict 4 1-7 3 12 1.03 0.68 Quantitative work overload 4 1-7 3.58 1.11 0 70 Qualttative work overload 4 1-7 2 44 0.89 0.70 Career progress 4 1-7 2 81 1.27 0 81 Responsibility for people 4 1-7 2 92 1 06 0.75 Ttrne pressure 4 1-7 4 50 1 30 0.86 Job scope 4 1-7 3.04 0 95 0.61

Extraorganizational stressor Work-home conflict 4 1--6 4 10 1.06 0.85

Stress outcomes Job-related tension 12 1-5 3.01 0.73 0 89 Job dissatisfaction 9 1-5 2.22 0.66 0.89 Propenstty to leave public accounting 2 1--6 3.39 1 54 0.86

• Sample size varies somewhat for each variable due to missing data. ~fAverage scale item score (sum of scale responses divided by no. of items in scale). ~Standard deviation of the average scale item score. § Cronbach's coeflictent alpha

Job dissatisfaction can be v iewed as an a t t i tude resu l t ing from the ba lanc ing and s u m m a t i o n of likes and dislikes expe r i enced in c o n n e c t i o n wi th one ' s job. It represen ts an overall evaluat ion of the job taking in to accoun t one ' s o w n persona l objec t ives (Bullock, 1952). The measure of job dissatisfaction is d rawn f rom a ques t ionna i re deve loped by Bullock ( 1 9 5 2 ) and used by Senatra (1980) . The scale consists of n ine items, each requ i r ing a subject ' s evaluat ion of the employ ing organiza t ion or the job itself.

Individuals may cons ider leaving their c u r r e n t pos i t ions for a variety of reasons, inc lud ing occupa t iona l stress (McKenna etaL, 1981 ). The c o n c e r n of this s tudy lies no t wi th the in t en t to swi tch f rom one pub l i c accoun t ing firm to another , bu t ra ther wi th the in t en t to leave pub l ic a ccoun t ing for a non-pub l i c a ccoun t ing job. Propens i ty to leave pub l ic a ccoun t ing is measu red by two ques t ions adapted from an i n s t r u m e n t deve loped by Cammann , Fichman, Jenkins and Klesh (Seashore etaL, 1982). These ques t ions are: "I of ten th ink abou t leaving pub l ic

accounting", and "I will probably look for a n e w job outside of publ ic account ing in the next year".

Data analysis This s tudy examines the re la t ionship b e t w e e n

a set of stressors and a set of stress outcomes: job-related tension, job dissatisfaction, and p ropens i ty to leave pub l ic account ing . Because of the likely in te rcor re la t ions wi th in the set of stressor variables and the set of s t ress-outcome variables, any statistical t e c hn i que used to examine the na tu re of the re la t ionship b e t w e e n the two sets mus t s imul taneous ly cons ider the shared var iance in bo th sets of variables. Because canonica l cor re la t ion analysis is able to ac- compl i sh this task, it was used to assess the stressor/stress o u t c o m e associations. 6

RESULTS

Descript ive statistics and in te rna l cons i s tency reliabil i t ies (Cronbach , 1951 ) are r epor t ed for

6 See Fornell & Larcker (1980) for a dtscussion of the use of canonical correlation analysis in accounting research, and Ferris & Larcker (1983) for an example of the application of canonical correlation analysis in an accounting study.

540 K. M COLLINS and L N. KILLOUGH

TABLE 2. Correlation matrix*

Variable 1 2 3 4 5 6 7 8 9 JT JD PL

Stressors 1. Role ambiguity 1 00 2 Role conflict 0 57 1.00 3. Quantitattve overload 0 22 0 56 1 00 4 Qualitattve overload 0 43 0 50 0 46 1.00 5 Career progress 050 0.38 0.11 034 6. Resp. for people 0.37 053 058 0.48 7. Time pressure 023 050 076 047 8 Job scope 058 052 026 0.40 9. Work-home conflict 028 0.41 0 50 0 34

1 00 0 33 1.00 0 16 0.51 1 O0 065 0.37 0 31 1.00 023 0.39 0.53 0.32

Stress outcomes (JT) Job-related tension 0.41 049 0.46 0.43 0 33 0.43 0 52 041 069 1.00 (JD) Jobdissattsfaction 042 038 016 029 0.58 024 021 054 025 0.35 1.00 (PL) Propensity to leave 0 22 0.26 0.21 0.21 0 34 0 16 0 23 0 36 0.29 0 31 0.53 1 O0

* All correlations are significant at the p < 0.001 level

each measure in Table 1. In te rna l reliabili t ies for all the variables are cons ide red acceptable for tes t ing the relat ionships (Nunnal ly , 1978) and are at least as high as those ob ta ined in past s tudies for eight of t en variables for wh ich compar i sons are possible ( Ivancev ich & Matteson, 1987; Miles & Perreault , 1976; Bullock, 1952). Wi th the excep t ion of the quant i ta t ive and quali tat ive over load stressors, the m e a n levels for the organizat ional stressors are higher 7 than those ob ta ined in a previous s tudy of managers by Ivancevich & Mat teson (1987) . The score for job-related t ens ion is higher than the m e a n score ob ta ined in a s tudy of managers, scientists, and eng ineers (Miles & Perreault , 1976). The m e a n score for job dissatisfaction is similar to that r epor ted in a previous s tudy by Miles & Pet ty (1975) . Because of adaptat ions made to the scales, compar i sons canno t be made b e t w e e n this s tudy 's means and those of previous studies for the "propens i ty to leave publ ic account ing" and the " w o r k - h o m e conflict" variables.

The cor re la t ion matr ix for the s tudy variables is p re sen ted in Table 2. Significant intercorrela- t ions that exist w i th in the set of stressors and wi th in the set of stress o u t c o m e s confirm the appropr ia teness of analyzing the data wi th a mult ivar ia te statistical t e chn ique such as canon- ical cor re la t ion analysis.

The objec t ive of canonica l cor re la t ion analysis 8 is to develop a l inear c o m b i n a t i o n of each set of variables (p red i c to r and c r i t e r ion) in a m a n n e r that maximizes the cor re la t ion b e t w e e n the two sets (Hair et aL, 1987). The bivariate cor re la t ion b e t w e e n the two l inear compos i tes (ca l led "variates") is the canonica l cor re la t ion (Thompson , 1984). The canonica l cor re la t ion p r oc e du r e does no t stop wi th the der iva t ion of a single re la t ionship b e t w e e n the sets (Hair et aL, 1987). Instead, the p r o c e d u r e con t inues by finding a second pair of variates that exhibits the max imum relationship be tween the two sets of variables no t accoun ted for by the first pair of variates. This process of crea t ing canonica l variates con t inues unt i l the n u m b e r of

7 Comparisons of means for stressors, job-related tension, and job dtssattsfactton for thts study with those of past studies were made at the 0 05 significance level.

s For a detaded dtscusston of canonical correlation analysts, see Thompson (1984). For a non-techmcal dtscusslon of the procedure, see Hatr et aL (1987)

STRESS IN PUBLIC ACCOUNTING

TABLE 3. Canonical correlation analysis results*

541

Canomcal variate pairs (functions) I II III

Canonical correlation (Rc) Squared canomcal correlation (Rc 2) Significance level of Rct Redundancy (Ro)

077 050 0.15 0 60 0.25 0 02

0 0001 0.0001 0 0026 031 007 001

Unrotated canonical loadings

Criterion set (outcomes) Job-related tension 0.93 - 0 35 -0.08 Job dtssatisfaction 0 65 0 76 - 0 02 Propensity to leave 0 51 0 28 0.81

Predictor set (stressors) Role amhigulty 0 63 0 28 - 0 58 Role conflict 0.68 0.07 - 0 16 Quantitative overload 0.57 -0.32 0.21 Quahtative overload 0.57 - 0 02 - 0 15 Career progress 0 61 0 71 - 0 O0 Responsibility for people 0 55 - 0 10 - 0 39 Time pressure 0 66 --0 29 O. 12 Job scope 0.68 0 53 0.10 Work--home conflict 0 83 -0.46 0 16

* Forty-one respondents had mtssing values for at least one of the variables and were thus omitted from the analysis. Thts reduced the sample for canomcal correlation analysts from 956 to 915. t F statisttc based on Rao's approximatton (Rao, 1973).

pairs of variates equals the n u m b e r of variables in the smaller set. 9

Three significant pairs of variates w e r e crea ted by the canonica l cor re la t ion analysis p rocedure . Table 3 provides the fol lowing informat ion for each pair of variates: ( 1 ) the canonica l variates, ( 2 ) the canonica l cor re la t ion (Rc), ( 3 ) squared canonica l cor re la t ion (Rc2), ( 4 ) statistical significance of the canonica l correla t ion, and ( 5 ) the r e d u n d a n c y coefficient (Rd), an index of the a m o u n t of var iance in one set of variables exp la ined by the variables in the o the r set (Stewart & Love, 1968). While the squared canonica l cor re la t ion represen ts an es t imate of the shared var iance b e t w e e n the canonica l variates, the r e d u n d a n c y index pro- vides an es t imate of the abili ty of the p red ic to r variables ( t aken as a se t ) to a ccoun t for var iat ion in the c r i t e r ion variables ( t aken one at a t ime) . As such the r e d u n d a n c y index is analogous to

the R 2 statistic used in mul t ip le regress ion (Hair

et aL, 1987). Total r edundancy , ob ta ined by s u m m i n g the a m o u n t of r e d u n d a n t var iance a t t r ibuted to each canonica l funct ion, is 0.39. Thus, a substant ia l a m o u n t of the var iance in the c r i te r ion set has b e e n a c c oun t e d for by the p red ic to r variables.

The re la t ionship b e t w e e n the set of p red ic to r variables and the set of c r i te r ion variables can be assessed by in te rp re t ing the pairs of variates. Before do ing this, however , a dec is ion mus t be made as to wh ich canonica l func t ions should be in terpre ted. The informat ion show n in Table 3 is used in making this decision. Al though all three pairs of variates have statistically significant canonica l correlat ions, the third canonica l func t ion is no t meaningful . The square of the canonica l cor re la t ion (Rc 2) for this pair of variates is be l ow the 0.10 acceptable level r e c o m m e n d e d by Thornd ike (1978) , and the

9 Because successive paws of canonical variates are based on residual variance, their respective canonical correlattons become progressively smaller. That is, the first pair of canonical vanates has the highest intercorrelation, the next pair the second highest, and so on

542 K. M. COLLINS and L N KILLOUGH

TABLE 4. Rotated canomcal loadmgs

Canonical variate parrs (functions) I II Communallty*

Crtterion set (outcomes) Job-related tension 0.96 0 26 0 99 Job dtssatisfaction 0 08 1 O0 1.00 Propensity to leave 0.25 0 52 0 34

Predictor set (stressors) Role ambiguity 0 35 0 61 0 48 Role conflict 0.51 0.46 0.47 Quantttative overload 0 65 0 08 0.42 Qualitattve overload 0 48 0 32 0 33 Career progress 0 09 0 93 0.88 Responstbility for people 0 50 0 24 0 31 TLme pressure 0 70 0.15 0.52 Job scope 0 25 0 83 0 75 Work-home conflict 0 94 0 12 0 90

* Row sum of squared loadmgs. Provides an estimate of the variance in each variable explained by the two functions taken together

r e d u n d a n c y l eve l is v e r y low. 1° Th is t h i r d pa i r o f

va r i a t e s w a s t h u s d r o p p e d f r o m t h e analysis .

C a n o n i c a l va r i a t e s a re i n t e r p r e t e d o n t h e bas i s

o f a s e t o f c o r r e l a t i o n coe f f i c i en t s , o r l oad ings ,

w h i c h r e p r e s e n t t h e s i m p l e l i nea r c o r r e l a t i o n

b e t w e e n e a c h i n d i v i d u a l va r i ab l e a n d i ts o w n

c a n o n i c a l var ia te . 1! C a n o n i c a l l o a d i n g s a re

a n a l o g o u s to f a c t o r l o a d i n g s a n d a re i n t e r p r e t e d

s imi lar ly . As is o f t e n t h e case , i n t e r p r e t a t i o n o f

t h e r e s u l t s is d i f f icul t b e c a u s e a l m o s t all t h e

v a r i a b l e s t e n d to b e h i g h l y c o r r e l a t e d w i t h t h e

first c a n o n i c a l f u n c t i o n ( T h o m p s o n , 1984) . 12

F o r t u n a t e l y , a c l e a r e r i n t e r p r e t a t i o n is o f t e n

o b t a i n e d b y r o t a t i n g t h e c a n o n i c a l va r i a t e s in

m u c h t h e s a m e w a y t h a t f a c t o r s a re r o t a t e d in

f a c t o r ana lys i s ( T h o m p s o n , 1984; C o h e n &

C o h e n , 1983; B e n t l e r & Huba , 1982; P e d h a z u r ,

1982; Forne l l , 1979; Cliff & Krus , 1976) .

S impl i f i ca t ion w a s t h u s a c c o m p l i s h e d b y ro ta t -

i ng t h e s t r u c t u r e c o r r e l a t i o n s o r t h o g o n a U y

u s i n g Ka i se r ' s ( 1 9 5 8 ) v a r i m a x r o t a t i o n m e t h o d .

T h e t h i r d f u n c t i o n , d e e m e d to b e tr ivial , w a s

d r o p p e d p r i o r t o r o t a t i o n . T h e r o t a t e d s o l u t i o n

a p p e a r s in Tab le 4. x 3

T h e r o t a t e d s o l u t i o n is a s u b s t a n t i a l i m p r o v e -

m e n t o v e r t h e u n r o t a t e d so lu t i on . W i t h t h e

~o While no generally accepted guidelines are available indicating a minimum acceptable index of redundancy (Hair et aL, 1987), it is apparent that the level of redundancy for the third pair ofvartates is unacceptable. The redundancy indices for the first and second pairs ofvanates are sufficsently high to justify interpreting these functions, although the level of redundancy for the second pair of vartates appears only marginally acceptable.

11 An alternative approach to interpreting canomcal functions is to examine the canonical wetghts Due to hmitations m the use of weights, loadings have been increasingly used in interpreting canonical functions (Thompson, 1984; Bentler & Huba, 1982; Fornell, 1979)

12 In deriving the first pair of variates, the canonical correlation procedure develops a linear combtnatton of each set of variables in a manner that maximizes the correlation between the two sets. The resulting linear combinations of variables account for more of the variance in the data as a whole than any other linear combinations Thts can make the interpretation of the first canomcal function difficult since the mathematics mean that as many variables as possible will be correlated with this first functton (Thompson, 1984).

~3 The followmg demographtc vaiaables were incorporated into the canonical correlation analysis, age, rank (senior/ manager), length of time in public accountmg, type of firm (nattonal/regionalAocal) and marital status. None of the variables was sigmficant and thetr inclusion changed the results httle, ff at all Consequently, these variables were dropped from the analysts.

STRESS IN PUBLIC ACCOUNTING 543

exception of the role-conflict and qualitative- overload stressors, the rotated solution provides a clear separation between large loadings and small ones. The variate communality scores for the criterion set indicate that a large amount of the variance in job-related tension and job dissatisfaction has been accounted for by the solution, while a substantial port ion of the variance in propensity to leave is unaccounted for. Thus, the solution should provide a fairly good understanding of job-related tension and job dissatisfaction, but not of propensity to leave public accounting. The variate communality scores for the predictor set show particularly large communalities for the w o r k - h o m e conflict and the career-progress stressors, suggesting that these two stressors are comprehended well through the analysis.

Relat ionship between stressors and stress

ou tcomes The first canonical function is descriptive

of job-related tension while the second is descriptive of job dissatisfaction and propensity to leave public accounting. Four stressors 14 w o r k - h o m e conflict, time pressure, quantitative work overload, and responsibility for people loaded highly on only the first canonical function, thereby indicating that these stressors are associated with job-related tension. These stressors are related to the high work demands of the profession. Work demands for public accountants can be great, both in terms of the quantity of work expected and knowledge and skills required. ~ 5 In addition, public accountants must adhere to tight and sometimes inflexible time schedules. Meeting the demands of the profession may limit time available for non-work activities and increase the potential for conflict between work and home.

Three stressors - - career-progress, job-scope, and role-ambiguity - - loaded highly on only the

second canonical function, signifying that these stressors are associated with job dissatisfaction and propensity to leave public accounting. These stressors stem from perceptions on the part of individuals that (a) promotion progress has been too slow or opportunities for advance- ment are limited, (b ) their jobs are unimportant or lack variety, and (c ) job objectives and responsibilities are unclear.

The remaining two stressors - - role conflict and qualitative overload - - loaded on both variates, indicating these stressors are important in understanding all three stress outcomes. The first of these stressors, role conflict, is reflective of the pivotal role played by individuals at the senior and manager levels in public accounting. Senior staff accountants and managers often report to several individuals within the firm, while maintaining close contact with numerous clients. Being subjected to multiple, often conflicting demands contributes to job-related tension as well as to job dissatisfaction and intention to leave. The second stressor, qualitative overload, results from perceptions on the part of individuals that they are not competent to perform their jobs. Stress related to feeling unqualified is associated with job- related tension and, to a lesser degree, job dissatisfaction and propensity to leave public accounting.

DISCUSSION, LIMITATIONS, AND FUTURE RESEARCH

The public accounting profession can be stress- ful, particularly for individuals occupying senior- and manager-level positions. Because these senior staff accountants and managers play such pivotal roles in their firms, gaining an understanding of the stressors they encounter and their consequences is important to the accounting profession.

14 Stressors are listed in order of tmportance, based upon absolute size of loading.

1 ~ Indivtduals m the study reported working an average of 59 hours per week during busy season (which lasts an average of 16 weeks) and 44 hours per week during non-busy season (Collins, 1988).

544 K.M. COLLINS and L N KILLOUGH

Although this study replicates many of the findings from past research on stress, it expands these past findings in several important ways. First, because a large, national sample of CPAs was used, the results may be more generalizable than results of many of the past studies which limited their sample to one accounting firm or one geographical area. Second, the study examined both organizational and extra- organizational sources of stress, while past studies have generally focused on work-related stressors only. Third, much has been learned through this study about the complex relation- ships be tween these stressors and three outcomes: job-related tension, job dissatisfaction, and propensi ty to leave public accounting.

Some stress in public accounting is unavoid- able, but stress can have negative consequences for both the individual and the organization. In addition to the stress consequences investigated in this study, other consequences of stress in public accounting have been identified. High levels of stress have been associated with psychological symptoms of anxiety and depres- sion (Haskins et al., 1990) and decreased job performance (Choo, 1986). In view of the potentially negative outcomes of stress identi- fied in this study and in past research, the task of CPAs and firms that employ them is to reduce stress to an acceptable level. Accounting firms should do this to pro tec t their most valuable asset - - their employees. For individuals, the motivation for reducing stress is to improve the quality of their lives. The knowledge gained through this study may be helpful to CPAs and their accounting firms in implementing needed stress-reduction programs.

Given the positive association be tween job- related tension and the work demands of the profession, accounting firms can a t tempt to reduce job-related tension by modifying work requirements ~6 This may mean reducing over-t ime and travel requirements, improving scheduling to ease deadline pressures, minimizing

conflicting requests, and instituting programs, such as flexible work schedules, designed to assist employees in balancing their career and family responsibilities. Individuals can strive to reduce job-related tension by recognizing the benefits of leisure activities, by getting away from work and cultivating non-work interests. Time-management and delegation skills should also be improved in an effort to use time, both at work and at home, more efficiently.

When attempting to reduce job dissatisfaction and propensi ty to leave public accounting, efforts should be directed towards clarifying job requirements, making work assignments interesting and challenging, and combatt ing career-progress problems. By exerting these efforts, firms may be able to increase the overall satisfaction of their employees, thereby reduc- ing turnover. Firms should not a t tempt to reduce all turnover, however. Given the pyramid-shaped hierarchy of the public accounting firm, with fewer positions available as one moves up the ladder, turnover benefits the firm by culling non-promotable personnel and assuring that p romot ion channels will not become clogged (Waller, 1985; Benke & Argualo, 1982; Istvan & Wollman, 1976). Turnover is a problem, though, when those leaving are the ones the firm would like to retain. Unfortunately, poor performers are not the only ones leaving their firms. Jackofsky et al. ( 1 9 8 6 ) found that turnover occurred among not only the lowest performers but also among the highest performers.

Firms should seek to identify those employees most compat ible with public accounting. Efforts can then be directed at these employees to make their jobs as satisfying as possible, thereby increasing the likelihood they will remain in the profession. For the firm, this means communicat- ing job requirements clearly, varying assignments to provide interesting work, and evaluating performance and career progress honestly and on a timely basis. For the individual, this means

6 See Colhns & Ktllough (1989) for a discussion of stress-reduction measures now bemg taken by public accounting firms and CPAs

STRESS IN PUBLIC ACCOUNTING 545

r eques t i ng c lar i f icat ion o f j ob r e q u i r e m e n t s w h e n no t p rov ided , seek ing cha l l eng ing assign- ments , and rea l i s t ica l ly eva lua t ing one ' s c a r e e r p r o g r e s s and a d v a n c e m e n t oppor tun i t i e s .

L i m i t a t i o n s

The s tudy resul t s n e e d to b e c o n s i d e r e d in l ight o f severa l l imita t ions . First, the use o f the mai l su rvey m e t h o d to co l l ec t da ta i n t r o d u c e s t he poss ib i l i ty o f a n o n - r e s p o n s e bias. Al though s ta t is t ical tes ts p e r f o r m e d to assess n o n - r e s p o n s e bias b y c o m p a r i n g ear ly and late r e s p o n d e n t s sugges t that n o n - r e s p o n s e was no t a p r o b l e m in this s tudy, this can n e v e r b e conc lus ive ly shown. Second, the s tudy used a se l f - repor t ins t rument . Poss ib le l imi ta t ions w i th a se l f - repor t i n s t r u m e n t are that the i n s t rumen t m a y no t b e we l l des igned , o r that sub jec t s m a y no t a n s w e r the ques t ions carefully. To r e d u c e the l i ke l ihood o f having a p o o r l y des igned ins t rument , on ly scales s h o w n to b e re l i ab le and val id in p r e v i o u s s tud ies w e r e used. After the ques t i onna i r e s w e r e d e v e l o p e d , t hey w e r e r e v i e w e d b y severa l p rofess iona l s and p i lo t t e s t ed at t w o large a c c o u n t i n g firms. 17 To assess w h e t h e r r e s p o n d e n t s a n s w e r e d the ques t ions careful ly, a n u m b e r o f i t ems w e r e r eve r s e scored . Third, t he c ross - sec t iona l na tu re o f

t he s tudy is a pos s ib l e l imita t ion. In fo rma t ion was c o l l e c t e d and ana lysed at o n e p o i n t in t ime, bu t i t is pos s ib l e that the re la t ionsh ips w o u l d be b e t t e r u n d e r s t o o d if s t ud i ed ove r t ime.

F u t u r e research

Many o p p o r t u n i t i e s ex is t to e x t e n d and i m p r o v e u p o n the p r e s e n t work . First, a na tura l e x t e n s i o n o f this r e sea rch p r o j e c t w o u l d b e to m o v e f rom the c u r r e n t c ross -sec t iona l des ign to a long i tud ina l design. Second, t he p r e s e n t s tudy measu re s s t ress o u t c o m e s exc lus ive ly t h r o u g h se l f - repor t ing. Fu tu re r e s e a r c h c o u l d pos s ib ly e m p l o y a mul t id i sc ip l ina ry a p p r o a c h b y supple- m e n t i n g these sub jec t ive measu re s o f s t ress ou t comes wi th physiological (med ica l ) measures o f phys ica l and men ta l distress. Finally, fu r ther ins ight in to the c o m p l e x issue o f s t ress in p u b l i c a c c o u n t i n g c o u l d be ga ined b y inves t iga t ing the cos t s o f s t ress at the firm level. A c c oun t i ng t e c hn ique s c o u l d b e u sed to i sola te the s t ress - re la ted c o m p o n e n t s o f cos t s such as absen tee i sm, insurance , r e c r u i t m e n t and train- ing. At taching a do l l a r cos t to stress, even a r o u g h es t imate , migh t e n c o u r a g e firms to i n t r o d u c e o r e x p a n d po l i c i e s for p r e v e n t i n g o r re l i ev ing w ork - r e l a t e d stress.

BIBLIOGRAPHY

American Institute of Certflied Public Accountants, Careers in Accounting (New York: AICPA, 1981).

Babbte, E IL, The Practice o f Social Research, 5th Edn (Belmont, CA Wadsworth, 1989). Batley,J. M & Bhagat, R. S., Meaning and Measurement ofStressors m the Work Envtronment: an Evaluatton,

m Kasl, S. V & Cooper, C L (eds), Stress and Work, Issues in Research Methodology, pp. 207-229 (New York. Wiley, 1987)

Bamber, E. M, Snowball, D & Tubbs, R. M., Audtt Structure and its Relationship to Role Conflict and Role Ambiguity: an Emptncal Investigation, The Accounting Review (April 1989) pp 285-299

Benke, R L & Argualo, C B, Why Do Professtonal Employees in CPA Firms Leave~, Virginia Accountant (March 1982) pp. 7-10.

Bentler, P. M & Huba, G J, Symmetric and Asymmetric Rotations in Canonical Correlation Analysis. New Methods with Drug Variable Examples, in Hirschberg, N & Humphreys, L G (eds), Multivariate Applications in the Social Sciences, pp 21-46 (Hillsdale, NJ: Lawrence Erlbaum, 1982 )

Bullock, 1L P, Social Factors Related to Job Satisfaction. a Technique for the Measurement o f Job

17 Copies of the questionnaires may be obtained from the first author upon request

546 ~ M. COLLINS and L N. KILLOUGH

Satisfactiorg Research Monograph Number 70 ( Columbus, OH: Bureau of Business Research, Ohto State University, 1952).

Burke, R.J., Sources of Managerial and Professional Stress m Large Organizations, in Cooper, C L & Payne, R ( eds ), Causeg Coping and Consequences of Stress at Work, pp 77-114 (New York Wiley, 1988 ).

Choo, F, Job Stress, Job Performance, and Auditor Personality Characteristics, Auditing a Journal of Practice & Theory (Spring 1986)pp 17-34.

Chff, N & Krus, D J, Interpretation of Canonical Analysis: Rotated vs. UnrotatedSolutlons, Psychometm'ka (March 1976) pp 35---43.

Cohen,J. & Cohen, P.,Apptied Multtple Regression/Correlation Analysis for the Behavioral Sciences, 2nd Edn (Hillsdale, NJ Erlbaum Assoctates, 1983)

Collins, K. M., A Comprehensive Study of Stress on Individuals in Middle-Management Positions in Public Accounting, Ph.D. dissertation (Vtrgima Polytechmc Institute and State University, May 1988).

Collins, K. M. & Killough, L N., Managing Stress m Public AccountmgJournal of Accountancy (May 1989) pp. 92-98

Cooper, C. L., The Stress Check (Englewood Cliffs, NJ Prenttce-Hail, 1981). Cox, T, Stress (London: Macmillan, 1978). Cronbach, L J., Coeflicmnt Alpha and the Internal Structure of Tests, Psychometrika (September 1951 ) pp.

297-334 Earnest, K. R & Lampe, J. C, Attitudinal Differences Between Male and Female Auditors, The Woman CPA

(July 1982)pp. 13-20. Ferns, K. IL & Larcker, D. F, Explanatory Variables of Auditor Performance m a Large Pubhc Accounting

Firm, Accounting Organizations and Society (1983) pp 1-11. Figler, H. IL, Managing Stress, Management Accounting (August 1980) pp. 22-28 Fletcher, B., The Epidemtology of Occupational Stress, m Cooper, C. & Payne, R (eds), Causes, Coping and

Consequences of Stress at Work, pp 3-52 ( Chichester: Wiley, 1988) Fornell, C., External Single-Set Components Analysis of Multiple Criterion/Multiple Predictor Varmbles,

MultivarlateBehavioralResearch (1979) pp 323--339 Fornell, C & Larcker, D F., The Use of Canonical Correlation Analysis in Accounting Research,Journal of

Business Finance & Accounting (1980) pp 455-473 Hair, J. F Jr, Anderson, R. E. & Tatham, R. L., Multivariate Data Analysis, 2nd Edn (New York Macmillan,

1987) Haskins, M E., Baghom, A J. & Cooper, C L., An Investigation of the Sources, Moderators, and Psychological

Symptoms of Stress Among Audit Seniors, Contemporary Accounting Research (1990) pp 361-385. House, R. J & Rizzo, J R., Role Confhct and Ambiguity as Critical Variables in a Model of Orgamzational

Behavior, Organizational Behavior and Human Performance (1972) pp 467-505 Istvan, D F & Woliman, J. B., Turnover in CPA Ftrms, The CPAJournal (July 1976) pp 21-25 Ivancevmh, J M & Matteson, M T, Stress and Work. a Managerial Perspective (Glenview, IL Scott,

Foresman & Co., 1980) Ivancevtch, J M & Matteson, M T, Stress Diagnostic Survey (Houston, TX. Stress Research Systems, 1983) Ivancevtch,J. M & Matteson, M T, Stress Diagnostic Survey Comments and Psychometric Properties of a

Multidimensional Self.Report Inventory (Houston, TX University of Houston, 1987) Jackofsky, E F, Ferris, IC R. & Breckenridge, B. G, Evidence for a Curvilmear Relattonshlp Between Job

Performance and Turnover,Journal of Management (1986) pp 105-111 Kabanoff, B, Work and Nonwork a Review of Models, Methods, and Findings, Psychological Bulletin

(1980) pp. 483-488 Kaiser, H. F., The Vartmax Criterion for Analytic Rotation in Factor Analysts, Psychometrlka (September

1958) pp 187-200 Kemery, E R, Bedeian, A. G, Mossholder, K. W. & Touliatos, J , Outcomes of Role Stress. a Multlsample

Constructive Replication, Academy of Management Journal (1985) pp 363-375 Knapp, C, Examining the Turnover Problem, Journal of Accountancy (November 1980) pp. 88-89. Kopelman, R. E., Greenhans, J H & Connolly, T F., A Model of Work, Family, and Interrole Conilict a

Construct Validation Study, Organizattonal Behavior and Human Performance (1983) pp. 198-215 Matteson, M T & Ivancevich, J. M., Managing Job Stress and Health (New York: Free Press, 1982) Matteson, M. T. & Ivancevich, J. M,, Controlling Work Stress (San Francisco, CA. Jossey-Bass, 1987). McGrath, J E, Stress and Behawor m Organtzations, m Dunnette, M D (ed.), Handbook of Industrial and

Organizational Psychology, pp. 1351-1395 (Chtcago Rand McNally, 1976) McKenna, J F, Oritt, P L & Wolff, H K., Occupational Stress as a Predictor in the Turnover Declson,

Journal of Human Stress (December 1981) pp. 12-17

STRESS IN PUBLIC ACCOUNTING 547

Miles, R H & Perreault, W D., Organizational Role Conflict its Antecedents and Consequences, Organizational Behavior and Human Performance (1976) pp. 19-44

Miles, R H & Petty, M. M., Relattonships Between Role Clarity, Need for Clartty, and Job Tension and Satisfaction for Supervtsory and Nonsupervisory Roles, Academy o f Management Journal ( 1975 ) pp. 877---883.

Mortimer, J T & Sorensen, G, Men, Women, Work, and Family, in Borman, K. M., Quarm, D. & Gtdeonse, S (eds), Women in the Workplace: Effects on Families, pp 139-167 (Norwood, NJ Ablex, 1984).

Near, J P., Rice, R. W. & Hunt, R. G, The Relattonshtp Between Work and Nonwork Domains a Rewew of Empirical Research, Academy o f Management Review (1980) pp. 415---429.

Nunnally, J C, Psychometric Theory, 2nd Edn (New York McGraw-Htll, 1978) Pearlin, L I. & Turner, H A, The Family as a Context of the Stress Process, m Kasl, S. V & Cooper, C. L (eds),

Stress and Health, Issues in Research Methodology, pp 143-165 (New York. Wiley, 1987) Pedhazur, E J.,Multiple Regression in BehavioralResearch, 2nd Edn ( New York: Holt, Rinehart & Winston,

1982). Pleck, J H, Stmnes, G. L & Lang, L, Conflicts Between Work and Family Life, MonthlyLaborReview (March

1980) pp 29-32. Qumk, J C & Qmck, J. D, Organizational Stress and Preventive Management (New York: McGraw-Hill,

1984). Rao, C ~ , Linear Statistical Inference (New York Wiley, 1973). Rebele, J E & Michaels, R. E, Independent Auditors' Role Stress Antecedent, Outcome, and Moderating

Variables, Behavioral Research in Accounting (1990) pp. 124--153. Rhode, J G, Sorensen, J E & Lawler, E E, III, Sources of Professtonal StaffTurnover in Pubhc Accounting

Ftrms Revealed by the Exit Intervtew, Accountin~ Organizations and Society (1977) pp. 165-175 Schuler, R S, Definition and Conceptualization of Stress m Organhzations, Organizational Behavior &

Human Performance (1980) pp 184-215 Seashore, S. E., Lawler, E. E., Mirvts, P H & Cammann, C (eds), Observing and Measuring Organizational

Change. a Guide to Field Practice (New York Wiley, 1982). Selye, H., Stress without Distress (New York- Lippincott, 1974) Selye, H (mtervlewed by Cherry, L ), On the Real Benefits of Eustress, Psychology Today (March 1978) pp.

60--70 Senatra, P T., Role Conflict, Role Ambiguity, and Organizational Climate m a Public Accounting Ftrm, The

Accounting Review (October 1980) pp 594--603 Staines, G L & O'Connor, P, Confhcts Among Work, Leisure, and Family Roles, Monthly Labor Review

(August 1980) pp 35-39. Stewart, D & Love, W, A General Canomcal Correlataon Index, Psychologtcai Bulletin (1968) pp

160-163 Thompson, B, Canonical CorrelaHon Analysis Uses andlnterpretatton (Beverly Hills, CA. Sage, 1984) Thorndike, R. M, Correlational Procedures for Research (New York Gardner, 1978). Waller, W S., Self-Selection and the Probability of Quttting: a Contractmg Approach to Employee Turnover

m Pubhc Accountmg, Journal o f Accounting Research (Autumn 1985) pp 817-828. Wetck, K. E., Stress m Accounting Systems, The Accounting Review (April 1983) pp. 350-369. Whtte, G E. & Hellnegel, D, Attttudes of CPAs Related to Professional Turnover, The Journal o f

Accountancy (June 1973) pp 86-88.