Abstract
This paper attempts to critically review literature on internal audit effectiveness. Some empirical findings were selected for the study. It was revealed that studies concentrated on public sector organizations. Also, internal auditors’ attributes were identified as the key for the measurement of internal audit effectiveness and that the relationship of internal auditors and external auditors, chief audit executives and senior management play a pivotal role in internal audit effectiveness. It is recommended that research in internal audit effectiveness should encapsulate empirical studies in the private sector organizations; comparative analysis of private and public sector organizations; attributes of internal auditors as the core measurement; and the relationship and/or causality of management support and internal audit effectiveness. Additionally, relationship of internal auditors with others including external auditors, chief audit executives and senior management should be emerging areas of research in internal audit effectiveness.
Highlights
Internal audit is very relevant to ensure the efficient utilization of resources, control misappropriation and combat fraud and misapplication of the resources of a company (Badara & Saidin, 2014)
It operates in departments that are inadequately resourced, lack qualified staff, have restrictions on their degree of independence, concentrate on compliance audit rather than performance audit, and where internal auditors are not accepted by management and auditees
The authors suggested that the state should play a more coercive role by encouraging organizations to establish internal audit departments and organize their activities in the manner specified in internal audit standards
Summary
Internal audit is very relevant to ensure the efficient utilization of resources, control misappropriation and combat fraud and misapplication of the resources of a company (Badara & Saidin, 2014). Internal auditing applies principles in an organization to ensure efficiency in the growth and development of a company leading to sustainable financial conditions. It is imperative to undertake a critical review of literature on internal audit effectiveness. This will make value additions to the growing literature on internal auditing and bring to the fore the theoretical and/or knowledge gaps to form the basis of further research into the field
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