scholarly journals Internal Audit Quality and Disclosure on Risk Management and Internal Control

2021 ◽  
Vol 8 (3) ◽  
pp. 154-164
Author(s):  
Nor Hafizah Zainal Abidin
Keyword(s):  
Risk Management ◽  
Internal Control ◽  
Audit Quality ◽  
Internal Audit

Effect of Financial Control Mechanisms on Performance of Income Generating Units in Selected Public Universities in Kenya

2019 ◽  
Vol 3 (V) ◽  
pp. 286-304
Author(s):  
Shadrack Musunkui Towett ◽  
Isaac Naibei ◽  
Williter Rop
Keyword(s):  
Risk Management ◽  
Internal Control ◽  
Public Universities ◽  
Management Strategies ◽  
Internal Audit ◽  
Simple Random Sampling ◽  
Target Population ◽  
Control Measures ◽  
Financial Control ◽  
Control Mechanisms

In an attempt to bridge the gap between the budgetary allocations and actual expenditures most universities have started income generating units with the aim of boosting their operational expenses. Whereas there is the potential of the use of Income Generating Units (IGUs) to generate additional funds, most universities still experience challenges in full implementation and realization of the revenue goal. This study therefore sought to determine the financial control mechanisms affecting performance of income generating units among selected public universities. The study sought to determine the effect of internal controls, credit policies, financial risk management and internal audit on performance of income generating units in selected universities. Targeted population was all the 290 employees in the IGU departments of selected public universities. The respondents were sampled using simple random sampling so as to enable equal representation of the target population without any biasness. Data collection was done using the questionnaire to ensure sufficient data was collected from the respondents. Descriptive statistics assisted in the determination of respondent’s views and opinions on every variable. Qualitative data was analysed using content analysis into meaningful, precise and comprehensive statements and presented in quotations. Data analysis was done using SPSS version 21 and data presented in form of figures and tables. The study ensured that all ethical considerations were considered by the study. The findings were that most employed Income Generating Units in Public Universities were Collection of rental fees, Evening and executive programs and Trainings of both short and long courses while the least was established to be Sales of memorabilia and books. All the financial control mechanism investigated namely internal audit, internal control measures, risk management strategies and credit policies had large extents of adoption in the selected universities. The results of the regression analysis showed that the financial control mechanisms investigated had a significant positive relationship on performance of the IGUs. Specifically, 47% of the variation of the performance of IGUs was established to be explained by the studied factors. The study concluded that the performance of the IGUs among the selected public universities was largely accounted for by the implemented financial control measures. Therefore effective financial control mechanisms is concluded to lead to better IGU performance whereas shortcomings in the financial control mechanisms is concluded to lead to diminished returns in the IGUs. The study recommended that the management in charge of the IGU department in the public universities to prioritize the formulation, implementation and monitoring of financial control mechanisms in the IGUs. To facilitate effective financial controls, the study recommended that the management especially those in the audit section to conduct regular checks and inspections on the IGUs. Additionally, frequent reforms were recommended to address the shortcomings experienced in integrating financial control measures in IGUs.

scholarly journals Faktor-Faktor Yang Mempengaruhi Kualitas Prosedur Pengendalian Internal Dan Perannya Dalam Memoderasi Hubungan Persepsi Keadilan Organisasi Terhadap Employee Fraud

MAKSIMUM ◽  
2020 ◽  
Vol 10 (1) ◽  
pp. 85
Author(s):  
Ika Hariyanti
Keyword(s):  
Risk Management ◽  
Organizational Justice ◽  
Internal Control ◽  
Internal Audit ◽  
Sampling Technique ◽  
Management Training ◽  
Management Level ◽  
Control Procedures ◽  
Employee Fraud

This research aims to analyze the perception of organizational justice on employeefraud moderated by the quality of the internal control procedures of manufacturecompany in Semarang. The factors which affect the quality of internal controlprocedures is ethical corporate environment, risk management training, internalaudit activities, suitability compensation and power leadership. The population ofthis research is the top management level at the manufacture company in Semarang.The sampling technique is random sampling. 32 samples used in this research andOLS regression analysis with SPSS 19 version program. The results of this researchverify that quality of internal control procedures positively moderate the relationbetween perception of organizational justice and employee fraud. Ethical corporateenvironment and risk management training has a positive and not significant to thequality of internal control procedures. Internal audit activities has positive andsignificant to the quality of internal control procedures. Suitability compensationand power leadership has a negative and significant to the quality of interna controlprocedures.

scholarly journals CORPORATE GOVERNANCE AND BUSINESS PERFORMANCE: THE MODERATING ROLE OF EXTERNAL AUDIT QUALITY

2020 ◽  
Vol 2 (2) ◽  
pp. 34-44
Author(s):  
Foong Seng Wong ◽  
Yuvaraj Ganesan ◽  
Anwar Allah Pitchay ◽  
Hasnah Haron ◽  
Ratih Hendayani
Keyword(s):  
Risk Management ◽  
Corporate Governance ◽  
Business Performance ◽  
Audit Quality ◽  
Internal Audit ◽  
External Audit ◽  
Management Committee ◽  
Age Diversity ◽  
The Relationship ◽  
Risk Management Committee

The purpose of this study is to investigate the relationship of corporate governance attributes, i.e. board size, age diversity, risk management committee and internal audit function with the business performance of the organisation. In addition, this study also examines the role of external audit quality as a moderating effect in the relationship between corporate governance and business performance. The study adopted a quantitative approach and cross-sectional design where it used a sample of 120 listed companies in Malaysia for the year 2016. Data is collected based on secondary data which is annual report year 2016. The result shows board size and the existence of risk management committee are negatively significant related to business performance while the other variables such as age diversity and internal audit function do not have an impact on business performance. Unexpectedly, external audit quality does not play a moderating role in related corporate governance and business performance. The study contributes to the understanding of the relationship between corporate governance and business performance in the developing country. The paper also provides related insight for regulators, policymakers and investors of emerging markets such as Malaysia. The study is the pioneer to understand the relationship of the risk management committee to business performance and moderating effect of external audit quality.

scholarly journals The Influence of COSO Organizational Framework Implementation on the Quality of Internal Control in Group of Companies Dani Prisma Mitra (DPM)

2018 ◽  
Vol 2 (1) ◽  
pp. 16-24
Author(s):  
Siswo Akhmad Nurhidayat
Keyword(s):  
Risk Management ◽  
Hypothesis Testing ◽  
Internal Control ◽  
Internal Audit ◽  
Management Training ◽  
Control Procedure ◽  
Control Procedures ◽  
Organizational Framework ◽  
Finance Department

This study analyzed the perception of organization members of the group of company in Dani Prisma Mitra (DPM) about the influence of COSO organizational framework consisting of company ethical environments, risk management training and internal audit activities on the quality of internal control procedures. Population in this research is all employee in finance and non-finance department with the level of supervisor and upward at DPM. Hypothesis testing used multiple regression analysis with a discussion of contingency theory. Hypothesis testing concluded that company ethics environments and internal audit activities have the positive and significant influence on the quality of internal control procedure, while risk management activities have a positive but not significant effect on to the quality of internal control procedure.

scholarly journals The Effect of Corporate Governance in Palestine on the Efficiency of Internal Audit: Empirical Evidence

2016 ◽  
Vol 8 (5) ◽  
pp. 124 ◽  
Author(s):  
Suhaib Tawfiq Jarrar
Keyword(s):  
Corporate Governance ◽  
Internal Control ◽  
Audit Committee ◽  
Audit Quality ◽  
Internal Audit ◽  
Public Companies ◽  
Internal Auditor ◽  
The Right ◽  
The Impact

This paper comes to examine the impact of corporate governance in Palestine on the efficiency of internal audit from the reality of the listed corporations in the Palestine Exchange; [PEX]. The population of this paper consists of all the 25 listed Palestinian companies in the Palestine Exchange that have internal auditor. It also includes another 5 companies that rely on the internal audit by external companies. Hence, the number of the reviewed companies by this study is 30 companies (Palestine Exchange Market). Thereupon, 30 questionaires were distributed and retrived. However, this manuscript states a summary of the most important results. These results are explained as is shown in the following: (1) the findings of the study state that there is an effect of applying the variables of corporate governance altogether on the quality of the internal audit of the listed public companies in the Palestine Exchange. These rules are (disclosure and transparency, accountability, responsibility, justice, and independency). (2) The results of the study indicate that there is a significant effect of applying the corporate governance variables individually on the quality of the internal audit of the listed public companies in the Palestine Exchange. Thus, the effect of these variables appears contrasted respectively as the following: disclosure and transparency, justice and accountability, independency and responsibility. (3) The corporate governance represents combining the right practices and procedures which operate within the standards and rules that governed by the obligatory standards. These standards aim at ensuring that there aren’t any contradictions between the strategic goals of the company and the fuctional procedures of the administration in achieving these goals. (4) The internal audit adds value to the company through the functions that enhance its performance within corporate governance. This includes providing information to all levels of the management, evaluating the system of the internal control and the risk management, in addition to sticking the company with the principles of corporate governance. The findings of the study come up with the following recommendations: (1) the study assures the importance of applying the corporate governance principles because of their clear effect on the internal audit quality. It also recommends working efficiently on the professional development of the auditors and improving their performance through training programs, as well, encouraging them to keep up with the latest developments in the field of the auditing and other related fields. (2) It strongly recommends working on enhancing and activating the role of the board of directors and the audit committee; as well as granting them the independency. Hence, they will be able to carry out the tasks assigned to them. Consequently, they will avoid the effects that the company may be exposed to as a result of the internal weakness of the practical aspects of the principles of corporate governance; in addition to the negative impacts of this issue on the quality of the internal audit.

Assessing Internal Audit with Text Mining

2018 ◽  
Vol 17 (02) ◽  
pp. 1850020 ◽  
Author(s):  
Georgia Boskou ◽  
Efstathios Kirkos ◽  
Charalambos Spathis
Keyword(s):  
Text Mining ◽  
Financial Reporting ◽  
Internal Control ◽  
Audit Quality ◽  
Internal Audit ◽  
Internal Controls ◽  
Annual Reports ◽  
Previous Attempt ◽  
Sarbanes Oxley ◽  
Audit Information

Recently internal controls, corporate governance and risk management have received a great deal of attention. Regarding internal control, several research studies address the issue of internal audit quality. Noteworthy, according to Sarbanes–Oxley (SOX) the internal controls over financial reporting are assessed by the auditors and the management. In the present study, we assess internal controls over financial reporting by employing Text Mining techniques. We analyse the annual reports of 133 publicly traded Greek Companies. The textual parts of the annual reports that refer to internal audit mechanism are extracted. We adopt a Vector Space model and the term-document matrix records the occurrence frequencies of the terms. By applying feature selection, a set of significant keywords, which are used as predictors, is extracted. The Linear Regression model developed explains the variance of the data and highlights significant predictors. The model manages to successfully assess the internal audit function. By performing PCA, major underlying procedures and concepts related to internal audit quality are revealed. Inspite of the undoubted importance of the assessment of internal audit, no previous attempt has been made to assess internal audit and to extract internal audit information from corporate disclosures by using Text Mining techniques. Our results can be useful to internal and external auditors, managers, company decision-makers, regulators and researchers.

scholarly journals Internal auditor’s contribution to good corporate governance: An empirical analysis for the one-tier governance system with a focus on the relationship between internal audit function and audit committee

2015 ◽  
Vol 13 (1) ◽  
pp. 141-151 ◽  
Author(s):  
Marc Eulerich ◽  
Patrick Velte ◽  
Jochen Theis
Keyword(s):  
Risk Management ◽  
Corporate Governance ◽  
Internal Control ◽  
Audit Committee ◽  
Control Function ◽  
Central Element ◽  
Internal Audit ◽  
Governance Structure ◽  
Governance System ◽  
Good Corporate Governance

The effectiveness and efficiency of the corporate governance structure depends on different governance bodies within the organization. As crucial parts of good corporate governance they provide constituting, monitoring and controlling tasks concerning the risk management and internal control system. These corporate governance mechanisms include the internal control function (IAF) and the audit committee (AC). Based on a dataset of 550 responses from U.S. internal auditors, our study explores empirically the IAF’s contribution to good corporate governance. Our results suggest that the IAF constitutes a central element of the governance structure. Furthermore, an intensive interaction between the IAF and the AC is positively linked with the efficiency and effectiveness of the governance processes, internal controls and risk management.

scholarly journals Analysis of Competence and Independence of Internal Auditor on Internal Audit Quality

2020 ◽  
Vol 5 (2) ◽  
pp. 96-102
Author(s):  
Leriza Desitama Anggraini
Keyword(s):  
Board Of Directors ◽  
Internal Control ◽  
Audit Quality ◽  
Task Force ◽  
Internal Audit ◽  
Study Data ◽  
Internal Auditor ◽  
The Board Of Directors ◽  
Operational Activities

Research is conducted with the aim of analyzing competencies and independence affecting the quality of audits in the company. The company's extensive scope restricts management and the board of directors from conducting direct oversight of internal and external activities in each of the company's operational activities. Therefore, management and the board of directors need a task force tasked with overseeing and examining the company's operational activities in order to improve internal control effectively and efficiently. There are still many problems of independence among internal auditors to date due to the position of internal Auditor working for management or working for the company. Research is carried out with a quantitative approach and with descriptive methods. The design of the research is a case study. Data collection techniques are carried out by questionnaire method and document inspection. Based on the results of the study concluded there is an influence of competence and independence on the quality of internal audits.

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