An evaluation of root cause analysis use by internal auditors

Abstract

The objective of this study is to increase understanding of internal auditor use of root cause analysis (RCA). The IIA’s Practice Advisory 2320–2: Root Cause Analysis (IIA 2011) states that RCA should be a core competency for internal auditors to provide insight and add value within organizations. However, little is known about internal auditor use of RCA in a profession where normative problem-solving theory and RCA frameworks potentially conflict with professional demands for independence and objectivity. We conduct in-depth interviews with 21 high-level internal auditors with RCA experience to understand use within the profession. The results suggest several overarching themes that have implications for policymakers, researchers, and practitioners. First, we find that internal auditors in practice believe that RCA is a very important tool within the profession. Second, although internal auditors generally claim to understand RCA, we find considerable variation in the ways they approach the construct and implement prescribed processes in practice. Finally, the results indicate that while RCA use is reasonably prevalent among internal auditors, knowledge constraints, resource limitations, and concern about independence and objectivity create considerable variation in terms of RCA approach, rigor, and efficacy within organizations.