The internal temperature of my device is proportional to the outside temperature. Example: 25 deg C outside, 45 deg inside. 35 deg C outside, 55 deg inside.
The device is placed in a sealed box along with the battery. The compensation circuit is based on the ambient temperature inside the box.
The temperature inside the device and outside is proportional...it is not incredibly accurate but will give me a rough value. The thermistor or probe must be located within the device.