(The relationship between the level of actual application of corporate governance principles and the efficiency of internal control systems)

Today, corporate governance is one of the concepts that have increased in importance and need in various sectors of the business because of its role and a significant impact in the process of corporate governance and the resulting protection of shareholders' rights and other parties that have interests with the company, so the importance of internal audit in all its administrative and technical aspects as one of the tools Which contribute to the application of the principles and rules of governance, and to be able to accomplish oversight functions and auditing in a manner that achieves the objectives envisaged by the commitment to the rules and principles of disclosure and proper disclosure of decisions and policies and the extent of adherence to the rules and standards of governance and presentation of information This research aims to measure and demonstrate the impact of the relationship between the actual application of the principles of corporate governance and the efficiency and effectiveness of internal audit systems in the private sector companies. The private sector operating in Iraq were selected three banks from this sector in the province of Maysan to be a sample of research and prepared a questionnaire to collect data and analyzed statistically The most important results that resulted from this study is that there is an actual application of the principles of governance in a relatively The Corporate Governance Code increases the efficiency and effectiveness of the internal audit systems in the companies. Key words:- corporate governance , internal control systems

The role and tasks of the internal audit and audit committee as bodies supporting effective corporate governance in insurance sector institutions in Poland

Oeconomia Copernicana ◽

10.12775/oec.2012.021 ◽

2012 ◽

Vol 3 (4) ◽

pp. 23-39 ◽

Cited By ~ 2

Author(s):

Elżbieta Izabela Szczepankiewicz

Keyword(s):

Control Systems ◽

Internal Control ◽

Audit Committee ◽

Economic Recession ◽

Internal Audit ◽

Financial Supervision ◽

Insurance Sector ◽

Internal Control System ◽

The Impact ◽

Effective Supervision

Faced with the risk of consecutive waves of financial crisis and economic recession, government committees, financial supervision authorities and financial institutions themselves – both in Poland and worldwide – have launched a number of measures to make the supervision of insurance sector institutions more effective, particularly in aspects related to efficient risk management and internal control. The article describes the impact of the amendment of laws and other regulations on the development of the present internal control systems in insurance sector institutions. It draws attention to the need for a new structure of the internal control system, and the role and purpose of the internal audit and the audit committee as the bodies supporting effective supervision in insurance undertakings and reinsurance undertakings.

Can internal audit functions improve firm operational efficiency? Evidence from China

Managerial Auditing Journal ◽

10.1108/maj-01-2019-2136 ◽

2020 ◽

Vol 35 (8) ◽

pp. 1167-1188

Author(s):

Ying Chen ◽

Bin Lin ◽

Lizhen Lu ◽

Gaoguang Zhou

Keyword(s):

Corporate Governance ◽

Internal Control ◽

Internal Audit ◽

Operational Efficiency ◽

Alternative Measure ◽

Maturity Model ◽

Firm Level ◽

Content Type ◽

Internal Auditors ◽

Purpose The purpose of this study is to examine the effects of internal audit function (IAF) quality on the operational efficiency of Chinese firms. Design/methodology/approach The authors use regression models with a sample of Chinese listed companies to test their research hypotheses. Findings The authors find that IAF quality is positively associated with firm operational efficiency. The result is unchanged after correcting for endogeneity via the instrumental variable method and using an alternative measure of firm operational efficiency. The authors show that IAF competence improves firm operational efficiency, but the relationship between IAF independence and firm operational efficiency is insignificant. Additionally, they find that IAF quality can only significantly improve firm operational efficiency in the presence of effective corporate governance at the firm level and strong institutions at the province level. Using path analysis, the authors find that an IAF can improve firm operational efficiency directly or indirectly by promoting firm internal control quality. Practical implications The findings of this study suggest the need for a balance between IAF competence and independence to achieve the goals of IAF. Additionally, the authors study suggests that the effectiveness of IAF is contingent on corporate governance and market-based institutions. Originality/value The study’s findings contribute to the burgeoning literature on the relationship between IAF and firm operational performance and deepen the authors’ understanding of the role of IAF in an emerging economy whose government plays a major role in promoting and enforcing internal audits. The study also empirically support the Internal Audit Governance Maturity Model proposed by the Institute of Internal Auditors.

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

International Journal of Economics and Finance ◽

10.5539/ijef.v8n5p124 ◽

2016 ◽

Vol 8 (5) ◽

pp. 124 ◽

Cited By ~ 1

Author(s):

Suhaib Tawfiq Jarrar

Keyword(s):

Corporate Governance ◽

Internal Control ◽

Audit Committee ◽

Audit Quality ◽

Internal Audit ◽

Public Companies ◽

Internal Auditor ◽

The Right ◽

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.

Известия Дальневосточного федерального университета Экономика и управление ◽

Система внутреннего аудита и контроля как элемент обеспечения экономической безопасности предприятия

10.24866/2311-2271/2020-1/55-64 ◽

2020 ◽

pp. 55-64

Author(s):

Светлана Ракутько ◽

Елена Селезнева ◽

Валерия Хафизова ◽

Валерия Страхова

Keyword(s):

Control Systems ◽

Internal Control ◽

Financial Stability ◽

Internal Audit ◽

Economic Security ◽

Economic Activities ◽

Market Mechanisms ◽

Simultaneous Control ◽

The Impact ◽

A Company

В работе предложены авторские подходы к понятиям «внутренний контроль» и «внутренний аудит», раскрыты их содержательные особенности, функции, формы организации на предприятиях, определены ключевые задачи систем внутреннего аудита и внутреннего контроля в аспекте обеспечения экономической безопасности. Проанализированы возможные варианты взаимодействия систем внутреннего аудита и внутреннего контроля и предложили к использованию наиболее подходящую модель их комплексного взаимодействия для осуществления единовременного контроля финансово-хозяйственных процессов и управления рисками компании. The company economic security is the result of its effective financial and economic activities. This relationship is due to the pattern of economic development and increased competition between economic entities. The current market mechanisms significantly impact on the company activities, that in turn necessitates them to look for the ways to ensure the financial stability and economic security. This article aims at studying the role the internal audit and internal control play to ensure the company financial stability and the impact of these tools on its economic security. The paper describes the authors’ approaches to the concepts of “internal control" and "internal audit", shows their content features, functions and forms of arrangement within a company. It also specifies the key objectives of the internal audit and internal control systems for ensuring the economic security. The authors analyzed the possible interactions of the internal audit and internal control systems and suggested the most appropriate model for their comprehensive interaction to be used for the simultaneous control of financial and economic processes and for the company risk management

The Extent to Which the Corporate Governance Characteristics Has Affected the Audit Report Lag in Jordanian Banks

International Journal of Business and Management ◽

10.5539/ijbm.v13n12p81 ◽

2018 ◽

Vol 13 (12) ◽

pp. 81 ◽

Cited By ~ 1

Author(s):

Lina Hani Warrad

Keyword(s):

Corporate Governance ◽

Audit Committee ◽

Management Practices ◽

Internal Audit ◽

Business Environment ◽

Audit Report ◽

Financial Reports ◽

Return On Equity ◽

Efficiency And Effectiveness ◽

The business environment has experienced rapid changes with critical implications on organizations in different countries, companies have responded to compete by improving their business management practices and enforcement instructions for the organization of its work and the methods of administration applied there in and work to improve the efficiency and effectiveness of accounting methods and auditing, from while supporting the internal audit departments of the monitoring and follow-up committees for accounting and auditing procedures to achieve transparency and credibility financial statements within their financial reports. There is an urgent need in presently the application of corporate governance on one hand and standards Accounting, Conduct and Ethics Auditing profession on the other hand. Because of the impact on the independence of auditors and increase effectiveness of their performance, as well as their role in evaluating the performance of management in the strengths of companies are through their organization of business and their appearance and weak performance (Al-Beshtawi, 2014). This study seeks to discuss the extent of association between corporate governance characteristics and the audit report lag ARLAG for the listed Jordanian Banks during the period from 2014 to 2016. The study used statistics measurements and tools to clarify the relations and hypotheses. The results found a significant relation between the corporate governance characteristics and audit report lag ARLAG jointly and separately with the board size BORSIZE, board diligence BORDEL, audit committee size ACSIZE and audit committee diligence ACDEL, and the relation was controlled by two variables: return on equity ROE and company size COMSIZE.

The importance of adopting principles of corporate governance for the quality of internal audit

Proceedings of the International Conference on Business Excellence ◽

10.2478/picbe-2018-0098 ◽

2018 ◽

Vol 12 (1) ◽

pp. 1089-1101

Author(s):

Fedaa Abd Almajid Sabbar ◽

Zaid Yaseen Saud Al-Dulaimi ◽

Talib Ghadhban Yaseen Alalawi ◽

Arshed Makki Rashid

Keyword(s):

Corporate Governance ◽

Private Sector ◽

Internal Audit ◽

Financial Information ◽

Internal Auditing ◽

Private Companies ◽

Economic Changes ◽

Corporate Governance Quality ◽

Abstract The topic of corporate governance and the quality of internal auditing have increased the importance in the light of fast economic changes. The financial systems of many of the world's largest companies face decreasing trust of the company's stakeholders and beneficiaries in the financial information they present. Iraq is considered one of the emerging countries in which the private sector suffers from the same problems as other international companies. At the same time, the indicators of financial and administrative corruption are increasing in the Iraqi economic and financial environments. The Iraqi environment requires the implementation of the principles of corporate governance, quality control and internal auditing. The aim of current study is to analyze the relationship and effects between the principles of corporate governance and the quality of the function of internal auditing in private companies in Iraq through statistical analysis of the survey data from a sample of internal audit managers and accountants. The recommendations presented aim to improve the quality of internal audit and support corporate governance to ensure the credibility of financial information disclosed in the financial statements by the executive departments in those companies, contributing to the decision-making process. The study reached several conclusions. The most important of these is that the effective and proper implementation of the principles of corporate governance in the private sector companies in Iraq will contribute to the improvement and development of the internal audit function in the company reflected positively on the performance, survival and continuity of corporate activity while safeguarding the interests of those involved.

Machine Learning Applications for Accounting Disclosure and Fraud Detection - Advances in Finance, Accounting, and Economics ◽

Corporate Governance

10.4018/978-1-7998-4805-9.ch003 ◽

2021 ◽

pp. 32-48

Author(s):

Marios Eugene Menexiadis

Keyword(s):

Corporate Governance ◽

Control Systems ◽

Internal Control ◽

Negative Impact ◽

Effective Control ◽

Control Mechanisms ◽

Corporate governance is the cornerstone for the organization, when it comes to effective internal control systems by modern organizations. Over the last 20 years, several business giants have collapsed under the weight of illegalities and frauds, such as Enron, WorldCom, Guinness, Maxwell Group, Barings Bank, etc. The impact of the failure of these organizations on the economies in which they were operating was particularly significant and had a negative impact on those directly or indirectly associated with them. The shareholders, as well as all stakeholders such as suppliers, customers, creditors, employees, and governments of the countries where the above organizations were active, were adversely affected. The failure of the organizations was attributed to the inadequacy of their boards and the lack of organized and effective control mechanisms by their management.

The impact of the application of corporate governance rules and principles on improving institutional performance

Journal of University of Human Development ◽

10.21928/juhd.v3n1y2017.pp203-229 ◽

2017 ◽

Vol 3 (1) ◽

pp. 203

Author(s):

Ammar Shihab Ahmed ◽

Osman Amin Ahmad

Keyword(s):

Corporate Governance ◽

National Income ◽

Institutional Performance ◽

Economic Implications ◽

Rules And Principles ◽

The Subject ◽

A Prospective Study ◽

Relationship Of ◽

The Impact ◽

It is the subject of corporate governance topics important due to the increasing moral hazard in the departments of joint stock companies practices resulting from the separation of management from ownership, which have opposite interests, which generated a host of problems between the two parties, which has affected negatively on the old and new investors to invest their money's confidence in joint-stock companies after the Crisis series the scandals, which affected major joint-stock companies, which led in turn to a decline in investment at the level of the overall economy and increasing unemployment, low national income, which has economic implications and social bad, hence the term corporate governance, the result of those problems are addressed by defining the obligations and rights of both the administration and other parties relevant, and that the application of the rules of corporate governance is very important to improve corporate performance, which has economic implications and his meeting positive. I have been conducting a prospective study on one of the joint-stock companies through the distribution of a questionnaire to some of the shareholders and employees in order to identify the extent of the application of corporate governance rules and principles of it, and the relationship of the company with other parties of non-contributors and has research found that the company management is working to their advantage and lack of attention to the interests of small shareholders and some foreign parties, which are at the heart of the application of the rules of banking governance.

Adherence to the Internal Audit Core Principles and Threats to Internal Audit Function Effectiveness

Auditing A Journal of Practice & Theory ◽

10.2308/ajpt-19-072 ◽

2021 ◽

Author(s):

Christopher G Calvin

Keyword(s):

Corporate Governance ◽

Future Development ◽

Internal Audit ◽

Internal Auditors ◽

The Core ◽

Body Of Knowledge ◽

Internal Audit Function ◽

Lower Likelihood ◽

Practitioner Survey ◽

I investigate the impact that adherence to the Institute of Internal Auditors' Core Principles has on the likelihood that an internal auditor's effectiveness is threatened through pressure to modify valid audit findings. I use responses from the Institute of Internal Auditors' 2015 Common Body of Knowledge Practitioner Survey to show that higher adherence to the Core Principles by both internal audit staff and CAEs is associated with a lower likelihood of being pressured to modify audit findings. I also explore which of the ten Core Principles are dominant in explaining these associations to inform the future development of the internal audit profession. Finally, I investigate the sources of pressure to modify audit findings and explore the effect the Core Principles have in mitigating pressure from each source. My findings are relevant to the Institute of Internal Auditors, internal audit practitioners, and academics interested in internal audit or corporate governance.

Board structure changes after accounting fraud: the case of Schneider Electric

The CASE Journal ◽

10.1108/tcj-04-2019-0036 ◽

2021 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Benedicte Millet-Reyes ◽

Nancy Uddin

Keyword(s):

Corporate Governance ◽

Internal Control ◽

Multinational Corporation ◽

Business Case ◽

Annual Reports ◽

Board Structure ◽

Control Mechanisms ◽

Accounting Fraud ◽

Content Type ◽

Theoretical basis The impact of corporate governance on internal controls and quality of financial disclosures. Research methodology Analysis of a real financial fraud event for a non-US multinational corporation. The case relies on accessing and analyzing annual reports for the firm, both before and after the fraud. Additional information on industry governance characteristics are provided in the case itself so that students can compare the firm to the industry. Case overview/synopsis This business case is centered on the analysis of Schneider Electric, a French multinational corporation, which had to restate their financial statements in 2011 because of accounting fraud. Following this event, Schneider undertook major changes in their board structure to improve internal control mechanisms. This pedagogical business case familiarizes students with international differences in ownership and board structure and emphasizes potential corporate governance changes after financial statement fraud. Complexity academic level Managerial finance, corporate finance, international finance, auditing. This case is more appropriate for upper-level undergraduate and graduate courses.