The Relationship Between Organisational Attributes and Internal Audit Effectiveness

Abstract

Prior studies show that the degree of internal audit effectiveness tends to vary with country-and organisation-level dynamics in an internal audit environment. The antecedents of internal audit effectiveness appear not fully explored as yet. This study, based on institutional theory, is aimed at investigating the relationship of internal audit effectiveness with two organisational attributes, i.e. organisational category and organisational size. To this end, a postal survey and an online survey were conducted among internal auditors in Poland. The research results show that although internal audit effectiveness does not significantly differ between public sector and private sector organisations, larger organisations in private sector have established more effective internal audit departments than their counterparts in smaller organisations. However, in the public sector the size of organisations is not related to internal audit effectiveness.

Critical Literature Review on Internal Audit Effectiveness

“…Mustika (2015) on his part, collected data from the internal auditor inspectorate in Java Province, Indonesia and Alzeban & Gwilliam (2014) obtained data from 79 Saudi Arabian public sector organizations. Shamki & Alhajri (2017) collected data for their work in the Omani public sector, whilst Bednarek (2017) gathered data based on the survey of organizations in Poland. Hailemariam (2014) work was on Ethiopian public sector offices.…”

“…The factors of internal audit effectiveness identified were mostly attributes of internal auditors. These were auditors' characteristics including auditor competency; auditors' independence; objectivity; professional proficiency; career advancement; and auditors' experience (Baharud-din et al 2014;Endaya & Hanefah, 2016;Dellai & Omri, 2016;Tackie et al, 2016;Mustika, 2015;Shamki & Alhajri, 2017;Bednarek, 2017;Rudhani et al, 2017;Hailemariam, 2014;Chevers et al, 2016;Bednarek, 2018;Musah et al, 2018). Attention of researchers could be deepened in the attributes of internal auditors as catalyst of internal audit effectiveness and understanding the dynamism of audit problems.…”