Internal Audit Fees Research Articles

INTERNAL AUDIT PRACTICE AND FINANCIAL REPORTING QUALITY: PERSPECTIVE FROM NIGERIAN QUOTED FOODS AND BEVERAGES FIRMS

The corporate failures and other related downfalls which occurred around the globe and Nigeria have raised fears about confidence in financial reporting practices by the listed firm in Nigeria. In recent times, financial crime has become more pervasive, and the probability of corporate fraud occurring in Nigeria has become more severe. These aspects of business failure have put greater responsibility on financial experts particularly auditors. Therefore, this study evaluated the attributes of internal audit practice and its influence on reporting quality of selected firms. Secondary data of nine (9) years range (2010 to 2019) were obtained from the financial reports of (4) four food and beverages firms purposively selected out of the twenty-three (23) listed on the Nigeria Stock Exchange as of December 2020. The internal Audit practice is the independent variable in this study and it is measured by three factors (Internal Audit fee, Technical Proficiency of internal auditor, and Firm Size). The dependent variable is the financial reporting quality. Mean ranking analysis was used to evaluate determinants of Internal Audit attributes in the selected firms while regression analysis was employed to measure the influence of internal audit quality on the financial reporting quality of sampled firms at 95% confidence level. The overall results (R2 0.8481; F-values = 21.51= and P-Value = 0.000) revealed that all the identified internal quality attributes (Internal Audit fee, Technical Training Proficiency, and Firm Size) were significantly related to internal audit practice and positively influence the financial reporting quality and performance of selected sampled food and beverages firms in Nigeria.

An Analysis of Internal Audit Investment Among Top Malaysian Listed Companies

The importance of internal audit function in improving the company’s internal control risk management and corporate governance has been emphasized in the Malaysian Code of Corporate Governance (MCCG) and Bursa Malaysia Listing Requirements. Based on the Listing Requirements, Malaysian listed companies are required to establish the internal audit function, which is independent and this function must be supervised by the audit committee. Although the importance of internal audit function has been highlighted in various code of corporate governance, little is known about the investment made by the company in internal audit activity. This study capitalizes the publicly available data on internal audit cost and the type of internal function provider in Malaysia setting. The primary purpose of this study is to describe internal audit practices, especially on the internal audit budget in Malaysia for the year 2017 for top 300 companies. Based on the descriptive analysis, it is found that the internal audit fee is relatively lower than the cost of external audit and most of the companies’ internal audit function was carried out by in house teams. Also, the benefit from economies of scale is less pronounced in internal audit as compared to external audit services. Some further analyses were also conducted, and the article is ended recommendations for future research to be undertaken in investigating the internal importance audit in Malaysia.

The Effect of Regulatory Oversight on the Association between Internal Governance Mechanisms and Internal Audit Fees

The Effect of Regulatory Oversight on the Association between Internal Governance Mechanisms and Internal Audit Fees

Neural Networks: Is it Hermeneutic?

This paper proposes a synoptic methodology to evaluate the determinants of audit fees by utilising Neural Networks. First, a brief discussion is presented to highlight the significant application of Neural Network in the areas of financial management; second the framework of proposed methodology has been outlined to examine the implication of audit fees on target sample. The underlying rational of this paper is to establish NNs as a diagnostic tool to assess the effect of audit fees on firms, which indeed warrants further empirical investigation. The importance of Neural Networks emerges from the fact that if external and internal audit fees can be disseminated by employing this methodology which is perceived more significantly robust than other econometric models, then accounting standards can be improved.