New perspective on the black box of internal auditing and organisational change

Kidron, Aviv; Ofek, Yuval; Cohen, Herztel

doi:10.1108/maj-07-2015-1220

Cited by 9 publications

(10 citation statements)

References 65 publications

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“…Further guidance on how to evaluate value added by internal auditing, considering stakeholder perspectives, is needed (IIARF, 2015). This need is amplified by the subjective nature of value added, as well as the need for further research into the perceptions of stakeholders (Sarens and De Beelde, 2006a;D'Onza et al, 2015;Lenz and Hahn, 2015;Kidron et al, 2016). Even though different stakeholders[2] may hold contrasting expectations of how value can be added by the internal audit function (Lenz and Hahn, 2015;Erasmus and Coetzee, 2018;Lenz et al, 2018), an unanswered question remains: How can the perceived value added by internal auditing be evaluated?…”

Section: Introductionmentioning

confidence: 99%

A framework for the evaluation of the perceived value added by internal auditing

Botha

Wilkinson

2019

MEDAR

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Purpose The purpose of this study is to propose a framework for the evaluation of the perceived value internal audit functions add to their organisations. The framework is based on service quality measurement principles, specifically SERVPERF, which is applied to internal auditing. Design/methodology/approach Insights obtained from the literature on internal auditing and service quality disciplines were synthesised to identify and structure value-adding attributes of internal auditing. A thematic analysis of published profiles (by Protiviti) of various organisations’ internal audit functions were analysed and evaluated against those attributes identified in the literature to formulate an evaluation framework based on service quality measurement principles. Findings The identified value-adding attributes were categorised according to the dimensions of the SERVPERF service quality measurement instrument to formulate a framework for evaluation of the value added by internal audit functions. It was found that the SERVPERF dimensions appear to be relevant to internal auditing. The SERVPERF instrument was therefore adapted to evaluate the value added by internal auditing as a service. Practical implications This paper contributes to both the theory and practice of internal auditing by proposing formal dimensions of a value-adding internal audit service which can then serve as a reference point from which to evaluate the value added to an organisation. The framework can serve as a starting point for internal audit functions to develop their service offering and/or form the foundation of stakeholder satisfaction surveys. Originality/value The study contributes to the literature by applying service quality principles to internal auditing. A holistic framework that can be used for the evaluation of the value added by internal audit functions based on stakeholder perceptions is proposed. The framework juxtaposes attributes of value-adding internal auditing with recognised service quality performance measures. The notion of value added is investigated to better understand the concept in the context of internal auditing services.

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Section: Introductionmentioning

confidence: 99%

A framework for the evaluation of the perceived value added by internal auditing

Botha

Wilkinson

2019

MEDAR

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“…the manager in charge of the audited process) needs to implement corrective measures (change) to improve organizational performance. This explains why IA and organizational learning are linked in this article, and why Kidron et al (2016) argues that internal auditors’ findings and recommendations constitute the first step to future organizational change.…”

Section: The Organizational Learning Perspective[3]mentioning

confidence: 90%

Internal audit: from effectiveness to organizational significance

Roussy

Barbe

Raimbault

2020

MAJ

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Purpose From the perspective of two groups of governance actors, this paper aims to understand how internal audit (IA) achieves and consolidates organizational significance. Design/methodology/approach Interviews were conducted with audit committee chairs and chief audit executives from multinational corporations, and the participating corporations’ registration documents were analyzed. Findings The data indicate that IA achieves and consolidates organizational significance by activating the IA effectiveness “building blocks” (Lenz et al., 2014) all together so as to generate organizational learning and positive change. New IA effectiveness drivers also emerged from the field. Research limitations/implications This research contributes to the IA literature by establishing a connection, through the IA impact on organizational learning, between the constructs of IA effectiveness and organizational significance. It also contributes to the IA literature by identifying new drivers and illustrating the complementarity and interconnections between the IA effectiveness building blocks. Practical implications This paper encourages internal auditors to keep their eyes on the prize (i.e. organizational significance) instead of simply being focused on the mean (i.e IA effectiveness), in order to fight stakeholder disappointment. Originality/value The paper proposes a conceptual model of IA organizational significance and gives key insights for setting up effective IA to stimulate organizational learning and fostering positive change in the whole organization.

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“…The use of data analytics in internal audit missions may also change the role of internal auditors. The use of data analytics could standardise practices and increase the efficiency of work (Kidron et al, 2016;Warren et al, 2015). In addition, the ability to test full data sets with data analytics makes reports more substantive and increases the relevance and value of the findings (Betti and Sarens, 2020).…”

Section: Internal Audit Rolementioning

confidence: 99%

Effects of digitalisation of organisations on internal audit activities and practices

Betti

Sarens

Poncin

2021

MAJ

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Purpose This paper aims to investigate how the internal audit function (IAF) modifies its activities and practices in relation to the digitalisation the organisation. This paper specifically examines the use of data analytics and the performance of consulting activities by internal auditors. Design/methodology/approach This paper is based on a survey conducted with 82 chief audit executives based in the USA and members of the institute of internal auditors. Findings Results indicate a positive relation between the organisation’s level of digitalisation and the use of data analytics by internal auditors during their missions. Results also indicate that the organisation’s level of digitalisation has an indirect effect on the proportion of the internal audit planning dedicated to consulting activities. Specifically, the use of data analytics mediates the relationship between the organisation’s level of digitalisation and the proportion of the internal audit planning dedicated to consulting activities. Research limitations/implications This research was conducted amongst internal auditors based in the US Future research could investigate the insights of other internal audit stakeholders and investigate different legal contexts. Practical implications Results show that digitalisation increases the use of data analytics by internal auditors and the performance of consulting activities. The results, therefore, highlight the importance of these two aspects for the IAF to continue to bring value to organisations. Originality/value This research provides more insights on internal audit working practices. The digitalisation of the organisation leads the IAF to use more data analytics and perform more consulting activities.

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New perspective on the black box of internal auditing and organisational change

Cited by 9 publications

References 65 publications

A framework for the evaluation of the perceived value added by internal auditing

A framework for the evaluation of the perceived value added by internal auditing

Internal audit: from effectiveness to organizational significance

Effects of digitalisation of organisations on internal audit activities and practices

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