_.gif)
_.gif)
Empirical Review on Factors that Determine an Internal Audit Effectiveness
Abstract
The goal of this study is to give a framework that explains how internal audit effectiveness may be operationalized and what factors can influence that effectiveness. Internal audits have become one of the most important tools for companies to ensure that their processes follow standard standards and standards. Internal audits provide numerous benefits that have been widely documented in the literature. Organizations, on the other hand, find it difficult to measure the performance of internal audits and to understand the aspects that determine audit effectiveness. A systematic literature study was done to identify relevant articles, as well as to gather and synthesize evidence on the operationalization of internal audit effectiveness and the factors that may influence internal audit effectiveness. Following a thorough review of the relevant studies, a comprehensive set of possibly affecting elements was developed. The systematic review's findings are compiled into a framework. The findings of this study will aid in a better understanding of the current status of internal audit effectiveness research, including the elements that influence it, as well as gaps and potential for future research. Understanding how internal audit effectiveness may be measured, as well as the elements that may influence it, can help organizations better understand their current performance and, ultimately, improve it in the future.
Keywords
Full Text:
PDFReferences
Abbott, L.J., Daugherty, B., Parker, S. and Peters, G.F. (2016), “Internal audit quality and financial reporting quality: the joint importance of independence and competence”, Journal of Accounting Research, Vol. 54 No. 1, pp. 3-40, available at: https://doi.org/10.1111/1475-679X.12099
Abdolmohammadi, M.J. and Sarens, G. (2011), “An investigation of the association between cultural dimensions and variations in perceived use of and compliance with internal auditing standards in 19 countries”, The International Journal of Accounting, Vol. 46 No. 4, pp. 365-389, available at: https://doi.org/10.1016/J.INTACC.2011.09.004
Al-Twaijry, A. A. M., Brierley, J. A., & Gwilliam, D. R. (2003). The development of internal audit in Saudi Arabia: An institutional theory perspective. Critical Perspectives on Accounting, 14(5), 507–531. https://doi.org/10.1016/S1045-2354(02)00158-2
Alzeban, A., & Gwilliam, D. (2014). Factors affecting the internal audit effectiveness: A survey of the Saudi public sector. Journal of International Accounting, Auditing and Taxation, 23(2), 74–86. https://doi.org/10.1016/j.intaccaudtax.2014.06.001
Arena, M. and Azzone, G. (2009), “Identifying organizational drivers of internal audit effectiveness”, International Journal of Auditing, Vol. 13 No. 1, pp. 43-60, available at: https://doi.org/10.1111/ j.1099-1123.2008.00392.x
Badara, M.S. and Saidin, S.Z. (2014), “Empirical evidence of antecedents of internal audit effectiveness from Nigerian perspective”, Middle-East Journal of Scientific Research, Vol. 19 No. 4, pp. 460-471, available at: https://doi.org/10.5829/idosi.mejsr.2014.19.4.1783
Baheri, J., Sudarmanto. and Wekke, I.S. (2017), “The effect of management support to effectiveness of internal audit for public universities”, Journal of Engineering and Applied Sciences, Vol. 12 No. 7, pp. 1696-1700, available at: https://doi.org/10.3923/jeasci.2017.1696.1700
Barisic, I. and Tusek, B. (2016), “The importance of the supportive control environment for internal audit effectiveness – the case of Croatian companies”, Economic Research-Ekonomska Istraživanja, Vol. 29 No. 1, pp. 1021-1037, available at: https://doi.org/10.1080/1331677X.2016.1211954
Bass, B.M. (1999), “Two decades of research and development in transformational leadership”, European Journal of Work and Organizational Psychology, Vol. 8 No. 1, pp. 9-32, available at: https://doi.org/10.1080/135943299398410
Beckmerhagen, I., Berg, H., Karapetrovic, S. and Willborn, W. (2004), “On the effectiveness of quality management system audits”, The TQM Magazine, Vol. 16 No. 1, pp. 14-25, available at: https:// doi.org/10.1108/09544780410511443
Bednarek, P. (2018). Factors Affecting the Internal Audit Effectiveness: A Survey of the Polish Private and Public Sectors, 1–16. https://doi.org/10.1007/978-3-319-68285-3_1
Chang, Y.T., Chen, H., Cheng, R.K. and Chi, W. (2019), “The impact of internal audit attributes on the effectiveness of internal control over operations and compliance”, Journal of Contemporary Accounting and Economics, Vol. 15 No. 1, pp. 1-19, available at: https://doi.org/10.1016/j.jcae.2018.11.002
Cohen, A., & Sayag, G. (2010). The Effectiveness of Internal Auditing: An Empirical Examination of its Determinants in Israeli Organisations. Australian Accounting Review, 20(3), 296–307. https://doi.org/10.1111/j.1835-2561.2010.00092.x
D’onza, G., Lamboglia, R., & Verona, R. (2015). Do it audits satisfy senior manager expectations?: A qualitative study based on italian banks. Managerial Auditing Journal, 30(4–5), 413–434. https://doi.org/10.1108/MAJ-07-2014-1051
Dal Mas, L. O., & Barac, K. (2018). The influence of the chief audit executive’s leadership style on factors related to internal audit effectiveness. Managerial Auditing Journal, 33(8–9), 807–835. https://doi.org/10.1108/MAJ-12-2017-1741
Daniela, P., & Attila, T. (2013). Internal Audit versus Internal Control and Coaching. Procedia Economics and Finance, 6(13), 694–702. https://doi.org/10.1016/s2212-5671(13)00191-3
Dellai, H., Ali, M. and Omri, B. (2016), “Factors affecting the internal audit effectiveness in Tunisian organizations”, Research Journal of Finance and Accounting, Vol. 7 No. 16, pp. 2222-2847.
Dikici, A., Turetken, O. and Demirors, O. (2018), “Factors influencing the understandability of process models: a systematic literature review”, Information and Software Technology, Vol. 93, pp. 112-129, available at: https://doi.org/10.1016/j.infsof.2017.09.001
Ege, M.S. (2015), “Does internal audit function quality deter management misconduct?”, The Accounting Review, Vol. 90 No. 2, pp. 495-527, available at: https://doi.org/10.2308/accr-50871
Endaya, K. A., & Hanefah, M. M. (2016). Internal auditor characteristics, internal audit effectiveness, and moderating effect of senior management. Journal of Economic and Administrative Sciences, 32(2), 160–176. https://doi.org/10.1108/jeas-07-2015-0023
Erasmus, L.J. and Coetzee, P. (2018), “Drivers of stakeholders’ view of internal audit effectiveness: management versus audit committee”, Managerial Auditing Journal, Vol. 33 No. 1, available at: https://doi.org/10.1108/MAJ-05-2017-1558Fadzil, F. H., Haron, H., & Jantan, M. (2005). Internal auditing practices and internal control system. Managerial Auditing Journal, 20(8), 844–866. https://doi.org/10.1108/02686900510619683
Goodwin, J. (2004),“A comparison of internal audit in the private and public sectors”, Managerial Auditing Journal, Vol. 19 No. 5, pp. 640-650, available at: https://doi.org/10.1108/02686900410537766
Hughes, S.B., Sander, J.F., Higgs, S.D. and Cullinan, C.P. (2009), “The impact of cultural environment on
entry-level auditors’ abilities to perform analytical procedures”, Journal of International Accounting, Auditing and Taxation, Vol. 18 No. 1, pp. 29-43, available at: https://doi.org/10.1016/J. INTACCAUDTAX.2008.12.004
IIA (2010), “Measuring internal audit effectiveness and efficiency”, IPPF Practical Guide. Institute of Internal Auditors (IIA) Report.
IIA (2016), “Measuring the effectiveness of the internal audit function”, Practical Tools for Internal Auditors. Institute of Internal Auditors (IIA) Report.
IIA (2017), “International standards for the professional practice of internal auditing”, Institute of Internal Auditors (IIA) Report.
IIARF (2015), “The CBOK 2015 global internal audit practitioner survey questions”, The Institute of Internal Auditors Research Foundation (IIARF).
IIARF (2019), “Common body of knowledge (CBOK)”, The Institute of Internal Auditors Research Foundation (IIARF), available at: https://global.theiia.org/iiarf/Pages/Common-Body-ofKnowledge-CBOK.aspx (accessed 7 April 2019)
Juwita, R. (2021). The Implementation of Micro Small Medium Enterpise (MSME) Accounting in Credits to Financial Institutions. Budapest International Research and Critics Institute (BIRCI-Journal): Humanities and Social Sciences, 4(2), 2257–2270. https://doi.org/10.33258/birci.v4i2.1920
Kitchenham, B. and Charters, S. (2007), Guidelines for Performing Systematic Literature Reviews in Software Engineering, 2nd ed., available at: https://doi.org/10.1145/1134285.1134500
Kitchenham, B., Pretorius, R., Budgen, D., Pearl Brereton, O., Turner, M., Niazi, M. and Linkman, S. (2010), “Systematic literature reviews in software engineering – a tertiary study”, Information and Software Technology, Vol. 52 No. 8, pp. 792-805, available at: https://doi.org/10.1016/J.INFSOF.2010.03.006
Kotb, A., Elbardan, H., & Halabi, H. (2020). Mapping of internal audit research: a post-Enron structured literature review. Accounting, Auditing and Accountability Journal, 33(8), 1969–1996. https://doi.org/10.1108/AAAJ-07-2018-3581
Lenz, R. and Hahn, U. (2015), “A synthesis of empirical internal audit effectiveness literature pointing to new research opportunities”, Managerial Auditing Journal, Vol. 30 No. 1, pp. 5-33, available at: https://doi.org/10.1108/MAJ-08-2014-1072
Lenz, R., Sarens, G. and Hoos, F. (2017), “Internal audit effectiveness: multiple case study research involving chief audit executives and senior management”, EDPACS, Vol. 55 No. 1, pp. 1-17, available at: https://doi.org/10.1080/07366981.2017.1278980
Lenz, Sarens, G. and Jeppesen, K.K. (2018), “In search of a measure of effectiveness for internal audit functions: an institutional perspective”, EDPACS, Vol. 58 No. 2, pp. 1-36, available at: https://doi.org/10.1080/07366981.2018.1511324
Mihret, D. G., & Yismaw, A. W. (2007). Internal audit effectiveness: An Ethiopian public sector case study. Managerial Auditing Journal, 22(5), 470–484. https://doi.org/10.1108/02686900710750757
Mihret, D.G., James, K. and Mula, J.M. (2010), “Antecedents and organisational performance implications of internal audit effectiveness”, Pacific Accounting Review, Vol. 22 No. 3, pp. 224-252, available at: https://doi.org/10.1108/01140581011091684
Mizrahi, S. and Ness-Weisman, I. (2007), “Evaluating the effectiveness of auditing in local municipalities using analytic hierarchy process (AHP): a general model and the Israeli example”, International Journal of Auditing, Vol. 11 No. 3, pp. 187-210, available at: https://doi.org/10.1111/ j.1099-1123.2007.00364.x
Oussii, A. A., & Boulila, N. (2020). Evidence on the relation between audit committee financial expertise and internal audit function effectiveness. Journal of Economic and Administrative Sciences, ahead-of-print(ahead-of-print). https://doi.org/10.1108/jeas-04-2020-0041
Prawitt, D.F., Smith, J.L. and Wood, D.A. (2009), “Internal audit quality and earnings management”, The Accounting Review, Vol. 84 No. 4, pp. 1255-1280, available at: https://doi.org/10.2308/accr.2009.84.4.1255
Ramamoorti, S. (2003). Research Opportunities in Internal Auditing. Journal of Government Financial Management, 52(3).
Sarens, G., Abdolmohammadi, M. J., & Lenz, R. (2012). Factors associated with the internal audit function’s role in corporate governance. Journal of Applied Accounting Research, 13(2), 191–204. https://doi.org/10.1108/09675421211254876
Shamki, D., & Amur Alhajri, T. (2017). Factors Influence Internal Audit Effectiveness. International Journal of Business and Management, 12(10), 143. https://doi.org/10.5539/ijbm.v12n10p143
Soh, D. S. B., & Martinov-Bennie, N. (2011). The internal audit function: Perceptions of internal audit roles, effectiveness and evaluation. Managerial Auditing Journal, 26(7), 605–622. https://doi.org/10.1108/02686901111151332
Tackie, G., Marfo-Yiadom, E. and Oduro Achina, S. (2016), “Determinants of internal audit effectiveness in decentralized local government administrative systems”, International Journal of Business and Management, Vol. 11 No. 11, available at: https://doi.org/10.5539/ijbm.v11n11p184 Internal audit effectiveness
Tarhan, A. Turetken, O. and Reijers, H. (2015), “Do mature business processes lead to improved performance? A review of literature for empirical evidence”, ECIS 2015, p. Paper 178, avaialble at: https://doi.org/10.18151/7217495
Vadasi, C., Bekiaris, M., & Andrikopoulos, A. (2020). Corporate governance and internal audit: an institutional theory perspective. Corporate Governance (Bingley), 20(1), 175–190. https://doi.org/10.1108/CG-07-2019-0215
Van Gelderen, S.C., Zegers, M., Boeijen, W., Westert, G.P., Robben, P.B. and Wollersheim, H.C. (2017), “Evaluation of the organisation and effectiveness of internal audits to govern patient safety in hospitals: a mixed-methods study”, BMJ Open, Vol. 7 No. 7, avaialble at: https://doi.org/10.1136/ bmjopen-2016-015506
Widajatun, V. W., & Kristiastuti, F. (2020). The Effect of Regional Financial Supervision, Accountability and Transparency of Regional Financial Management on Local Government Performance. Budapest International Research and Critics Institute (BIRCI-Journal): Humanities and Social Sciences, 3(4), 2966–2974. https://doi.org/10.33258/birci.v3i4.1319
Wohlin, C. (2014), “Guidelines for snowballing in systematic literature studies and a replication in software engineering”, Proceedings of the 18th International Conference on Evaluation and Assessment in Software Engineering – EASE ’14, pp. 1-10, avaialble at: https://doi.org/10.1145/ 2601248.2601268
DOI: https://doi.org/10.33258/birci.v4i3.2077
Article Metrics
Abstract view : 404 timesPDF - 414 times
Refbacks
- There are currently no refbacks.
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.