Internal audit effectiveness: an Ethiopian public sector case study

TLDR

Internal audit services have received limited examination to date. The study aims to identify factors affecting the effectiveness of internal audit services. Using a case study of a large Ethiopian public sector higher education institution, the authors examine how internal audit quality, management support, organizational setting, auditee attributes, and their interactions influence internal audit effectiveness. The study finds that internal audit effectiveness is strongly driven by internal audit quality and management support, while organizational setting and auditee attributes have little effect, and identifies areas needing improvement. The study’s conclusions are limited in generalizability due to its case study design.

Abstract

Purpose The purpose of the study is to identify factors impacting the effectiveness of internal audit services. Design/methodology/approach Based upon a case study of a large public sector higher educational institution in Ethiopia, the paper examines how internal audit quality, management support, organizational setting, auditee attributes, and the interplay among these factors, influence internal audit effectiveness. Findings The findings of the study highlight that internal audit effectiveness is strongly influenced by internal audit quality and management support, whereas organizational setting and auditee attributes do not have a strong impact on audit effectiveness. Research limitation/implications As in all case studies, the generalisability of the conclusions is limited. Originality/value Internal audit services have apparently hitherto been the subject of limited examination. However, this study, in arguably the most thorough treatment so far, highlights the areas requiring improvement.