The Internal Control Explosion

Maijoor, Steven

doi:10.1111/1099-1123.00305

Cited by 64 publications

(39 citation statements)

References 6 publications

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“…Agency theory is utilized to elucidate the phenomena, as literature showed agency theory being predominantly used in public sector accountability research (Schillemans and Busuioc 2015) and being very much related to governance issues such as monitoring mechanisms (Maijoor 2000). Accountability refers to relationships between two (or more) persons, where one is obliged to be responsible for his or her behaviour to the other(s), and some specific mechanisms are arranged to make him or her behave in an accountable manner (Dubnick and Frederickson 2010).…”

Section: Hypothesis Development and Research Modelmentioning

confidence: 99%

Information Technology Governance on Audit Technology Performance among Malaysian Public Sector Auditors

Veerankutty¹,

Ramayah

Ali

2018

Social Sciences

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Abstract:The concept of Industry 4.0 has considerably altered the way organisations operate and has impacted every aspect of life. Furthermore, the fast-growing trend of information technology (IT) transformation in organisations and huge IT investment by Malaysian government have triggered the significance of IT risk and its related controls. Besides, technology-enabled auditing and IT-oriented audit procedures have become crucial when performing audit tasks in an electronic environment. Although many initiatives are being implemented to improve technology usage, audit technology use among auditors is still low and auditors are not attaining sufficient progress in the use of technology. This implies the current strategies and policies may not effectively support technology implementation. In the same vein, the under-utilisation of technologies was reported due to inadequate governance. Thus, this study intends to investigate the impact of IT governance on audit technology performance. IT governance is a mechanism to stimulate anticipated behavior in the use of technology among the employees of an organisation. Surveys using closed-ended questionnaires were distributed to approximately 309 Malaysia public sector auditors. The results show that IT governance mechanisms such as IT strategy and management support significantly influence the audit technology performance. IT governance does play a significant role in assuring the successful utilisation of audit technology.

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Section: Hypothesis Development and Research Modelmentioning

confidence: 99%

Information Technology Governance on Audit Technology Performance among Malaysian Public Sector Auditors

Veerankutty¹,

Ramayah

Ali

2018

Social Sciences

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“…Most corporate governance literature underscores the indispensable role of internal controls in strengthening the governance structure of organizations (Maijoor, 2000). The long-term confidence of stakeholders-government, suppliers, investors, customers in the areas of reporting, accountability and reliable information is fortified with effective internal control systems (Rittenberg & Schwieger, 2001).…”

Section: Literature Reviewmentioning

confidence: 99%

Effect of internal controls on credit risk among listed Spanish banks

Akwaa-Sekyi

Gené

2016

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Purpose: The paper examines the effectiveness of internal control systems, explores the exposure of Spanish banks to the dangers of default as a result of internal control systems and establishes a relationship between internal controls and credit risk. There is significant effect of internal controls on credit risk especially the control environment, risk management, control activities and monitoring. The non-disclosure of material internal control weakness is a contributory factor to the ineffective internal control systems. There is however a perceived board ineffectiveness which does not augur well for effective internal control systems. Board characteristics for Spanish banks confirm the agency theory. Practical implications: Bank management will find the work useful to ensure strict enforcement of internal control mechanisms and see it as both credit risk and operational risk issues. Central bank should hurry to compel banks to disclose material internal control weakness as provided in the reviewed COSO framework. Research limitations/implications: Social implications:Ineffective internal controls lead to credit risks, bank closure and loss of investments. Society suffers a lot from such losses and contagion. Disclosure of material internal control weakness is a social responsibility of banks.Originality/value: The authors are yet to come across the use of purely quantitative variables to model the effect of elements of internal controls on credit risk. This study opens and adds a new dimension of internal controls not only to be seen as operational risk issue but also credit risk.

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“…The audit committee is concerned with recruiting and terminating the head of the internal audit, and the frequency and duration of the meetings with the internal auditors [27][28][29], as well as ensuring that the internal auditors, especially their head, can communicate directly with the audit committee anytime. The audit committee's meetings with the head of the internal audit enhance the independence of the internal audit function, supporting the parties' discussion about management's errors, irregularities, violations, and fraud.…”

Section: Relationships With Internal Auditorsmentioning

confidence: 99%

The Nature of a Dynamic Relationship between Audit Committee and Auditors, both Internal and External

Am¹

2016

Bus Eco J

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Good corporate governance is now considered a basic condition to accept and register an organization in most of the Stock Exchange Markets all over the world. The audit committee plays a major role in corporate governance regarding the organization's direction, control, and accountability; part of which is the organization's internal control which is used to provide reasonable assurance about the integrity of management and reliability of the financial reporting. This paper focuses on the audit committee's powers and functions. The importance of the audit committee's oversight and monitoring responsibilities to the organizations' board of directors, shareholders, and other stakeholders, as well as to governing and regulating bodies, have been increasing, especially after the corporate collapse and the passage of the U.S. Sarbanes-Oxley Act of 2002. Consequently, most publicly held companies all over the world have been asked to establish and maintain audit committees. These companies and other types of organizations do establish and maintain audit committees to oversee and monitor their overall financial performance, including overseeing the preparation of the financial statements and other financial reports, as well as monitoring the external and internal auditors' performance. The relationship between the audit committee and both external and internal auditors is important for all parties to fulfill their job commitments. An organization's board of directors relies on the audit committee's reports about matters related to managing, directing and controlling the organization. The audit committee acts as a link, and facilitates the communications, between the board of directors and both internal and external auditors.

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The Internal Control Explosion

Cited by 64 publications

References 6 publications

Information Technology Governance on Audit Technology Performance among Malaysian Public Sector Auditors

Information Technology Governance on Audit Technology Performance among Malaysian Public Sector Auditors

Effect of internal controls on credit risk among listed Spanish banks

The Nature of a Dynamic Relationship between Audit Committee and Auditors, both Internal and External

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