Internal audit effectiveness: operationalization and influencing factors

TLDR

Internal audits are key for ensuring process adherence and are widely recognized for their benefits, yet assessing their effectiveness and the influencing factors remains challenging, making this study a comprehensive source for future research. The study introduces a framework for operationalizing internal audit effectiveness and identifies influencing factors to advance understanding of the research landscape and highlight future gaps. A systematic literature review was conducted to identify, collect, and synthesize evidence on how to operationalize internal audit effectiveness and its influencing factors. The review produced a comprehensive list of indicators for operationalizing audit effectiveness, identified influencing factors, and synthesized these into a practical framework that helps organizations assess and improve audit performance.

Abstract

Purpose The purpose of this paper is to introduce a framework that presents how internal audit effectiveness can be operationalized and what factors are available to influence the effectiveness. Internal audits have become one of the key practices for organizations to control the adherence of their processes to standard procedures and regulations. The benefits of conducting internal audits are well acknowledged in the literature. However, it is difficult for organizations to assess the effectiveness of internal audits and to understand the factors that influence audit effectiveness. Design/methodology/approach A systematic literature review was conducted to identify relevant publications and collect and synthesize evidence on the operationalization of internal audit effectiveness and the factors that potentially influence the effectiveness of internal audits. Findings A thorough analysis of the relevant studies resulted in a comprehensive list of indicators used for the operationalization of audit effectiveness and a list of potentially influencing factors. The results of the systematic review are synthesized into a framework. Research limitations/implications The researchers should consider this study as a comprehensive source that offers pointers on the factors investigated in the literature and a basis for future research in this field to address the gaps that are identified. Practical implications Awareness about how the effectiveness of internal audits can be measured, and the factors that can potentially influence this effectiveness can help organizations to understand their current performance and ultimately improve it in the future. Originality/value The contributions of this study will help in better understanding the state of the research on internal audit effectiveness, including the influential factors, and gaps and opportunities for future research.