Thesis (Ph. D.)--University of Wisconsin--Madison, 1984. / Typescript. Vita. Description based on print version record. Includes bibliographical references (leaves 309-327).

The intent of this research is to inform companies that the internal audit function has greater utility than just corporate governance. The internal audit function represents a resource to the business that can be used in a number of ways to help it survive, compete and establish new growth opportunities in the marketplace for the firm. The proposed project will demonstrate through an interpretive process study using case study research how the internal audit function can be a strategic business partner by highlighting its contribution ability in a dynamic, ever-changing, regulatory laden environment. This paper uses Punctuated Equilibrium Theory to explain the organizational transformation of the internal audit function from a professional bureaucracy to an adhocracy as an unintended consequence of corporate governance legislation over time. The study contributes to the literature by explaining the evolutionary change in the internal audit function from scorekeeper-and-watchdog to business-partner-and-change agent. This study analyzes how senior management benefits from utilizing the internal auditors’ experience as an organizational tool to address threats and opportunities.

The purpose of this dissertation was to examine how managers' judgments from an internal auditor's recommendation are influenced by some aspects of newer data sources and the related visualizations. This study specifically examined how managers' judgments from an internal auditor's recommendation are influenced by the (1) supportiveness of non-financial data with the internal auditor's recommendation and (2) evaluability of visual representations for non-financial data used to communicate the recommendation. This was investigated in a setting where financial data does not support the internal auditor's recommendation. To test my hypotheses, I conducted an experiment that uses an inventory write-down task to examine the likelihood that a manager agrees with an internal auditor's inventory write-down recommendation. This task was selected as it requires making a prediction and both financial and newer non-financial data sources are relevant to inform this judgment. The study was conducted with MBA students who proxy for managers in organizations. Evaluability of visual representations was operationalized as the (1) proximity of financial and non-financial graphs, and (2) type of non-financial graph as requiring a length judgment or not. This dissertation contributes to accounting literature and the internal auditing profession. First, I contribute to recent experimental literature on data analytics by providing evidence that newer non-financial data sources will be integrated into managers' judgments even when financial data is inconsistent. However, I also identified that the effectiveness of appropriate agreement with an internal auditor's recommendation depends on the evaluability of the visualizations for non-financial data. Second, I expand on the literature that examines managers' agreement with recommendations from internal auditors by examining an unexplored yet relevant context of using newer non-financial data sources and communicating these results. Specifically, I identified how the evaluability of visual representations for non-financial data interacts with the supportiveness of non-financial data with the internal auditor's recommendation to create differences in managers' agreement with the recommendation. I also identified confidence in the internal auditor's recommendation as an explanatory variable in some situations. My findings also have practical value for the internal auditing profession to understand the importance of appropriate visualizations in audit reporting.

Corporate governance has received increased attention from both regulators and researchers in recent years resulting in highlighting the significance of the internal audit function (IAF). Another transformative force on the IAF has been the dissemination of enterprise resource planning (ERP) systems which have an impact on the legitimacy of the IAF if it is not suitably adapted. However, there is insufficient knowledge about the adaptations of the IAF which are required if it is to maintain its essential role in governance. This thesis extends our knowledge by exploring and theorising the adaptation of the IAF after ERP introduction. This thesis uses institutional theory as a lens through which to investigate how the IAF responds to the external governance pressures and the internal pressures of the control logic following the introduction of an ERP system. Data were gathered from two listed companies in the food and beverage sector and two large banks operating in Egypt, where one of each pair is an international company and the other is a national company. Interviews and focus groups were conducted with all stakeholders in addition to careful analysis of a number of internal and external documents related to the ERP and the IAF. The study finds that governance pressures related to the IAF determine the legitimisation criteria for the IAF. There is little coercive governance pressure on the IAF in Egypt. However, international companies with operations in Egypt have introduced normative governance pressures as a result of their compliance with stock exchange rules in other jurisdictions. Therefore, mimetic behaviour has helped in transferring the IAF response to ERP implementation. ERP systems carry new control logics based on some interlinked assumptions, which have affected the IAF. The ERP system’s control logic is aligned with the corporate governance goals and objectives, but further alignment is needed to make the best use of the ERP system in enhancing internal control. The introduction of an ERP system produces uncertainty about the IAF’s activities, which motivates it to adapt by changing its practice and structure. The changes in the IAF are dependent on the strategic response adopted by the auditors, which range from acquiescence to defiance. These responses were found to change over time. The differences in responses result in different outcomes for the IAF adaptation. In the international companies the implementation of an ERP system motivates the IAF to be integrated and have a comprehensive scope, whereas in the national companies change was resisted and the role of the IAF was significantly diminished. The IAF’s legitimacy maintaining strategies depend on the coercive and normative governance pressures, which give directions about how to maintain legitimacy. This study offers an explanation of how information systems contribute to the IAF’s professional stability or change and of how macro-governance pressures can bind micro-IAF practice within organisations.

This study examines the impact of knowledge, experience, goal orientation, ethical orientation, and personality traits on managers' and accountants' abilities to recognize misappropriation of assets. Participants included students and professionals. The student group included upper-level accounting majors and upper-level management majors. The professional group included students enrolled in an introductory accounting course for their MBA program and internal auditors from a variety of organizations. Findings in the study show that accounting students assessed the possibility that fraud was in progress at a higher level than the management students, suggesting that the accounting students acquire basic knowledge about fraud from the accounting curriculum, which improves performance. The effect of reading articles was marginally significant for assessing the possibility of fraud, showing that students who have read or who are required to read articles better identify the clues associated with employee theft. For the professional group, the effects of academic major and fraud specific training led to identifying the possibility of employee theft at a higher level. It appears that training sessions help professionals in identifying the risk factors associated with fraudulent activity, producing benefits to organizations that far outweigh the costs. Full-time work experience was marginally significant (p Several findings of the additional analysis using structural equation modeling extend the audit decision making literature by showing certain factors that enhance knowledge and improve decision making as experience increases. Higher learning goal orientation scores, mediated by experience and ethical position, should lead to more accurate identification of risk factors that are commonly associated with fraudulent activity. These findings should encourage firms to draw upon the knowledge of experts as they develop expert decision aids and training sessions for internal audit departments. Organizations should also integrate actual instances of misappropriation of assets into training sessions on fraud prevention and detection while developing and improving models of training sessions and expert decision aids for unstructured, complex tasks.

Organisations are constantly striving to maximise shareholder wealth by improving effectiveness and efficiency of operations. There has been an emerging trend since the early 1980‟s to outsource functions which were considered non-core. These trends have now moved into the internal audit sphere, a function which was previously maintained in-house. With the outsourcing of Internal Audit Functions issues such as independence and the value adding approach of internal audit are brought into question. This paper explores similarities and differences between public sector internal auditing and its counterpart in the private sector in South Africa. Using survey data collected from a purposive mix of 72 organisations in the South African private and public sector, the degree of internal audit outsourcing, the rationales behind their outsourcing decisions, the types of internal audit services providers, the perceived status of in-house and the perception of Independence of outsourced Internal Audit Functions were investigated. Results from statistical analysis suggest that there was no significant difference in the consideration of outsourcing of Internal Audit Function by sector. The private sector was significantly more likely to consider internal audit a core activity when compared to the public sector while the public sector were more uncertain. No significant differences were observed between sectors with regards to interaction with external auditors in terms of coordination of areas of audit coverage and work schedule. Private companies were significantly more likely to have longer hours provided by interval service providers relative to outside providers when compared to the public sector. The biggest difference appears to be that private companies chose a big 4 accounting firm more often than in the government sector. Conversely the government sector had a higher frequency of choosing smaller accounting firms and specialised internal audit providers when compared to the private sector. The value of this research study contributes to the existing body of knowledge by means of bridging the gap between the theory and practice from a developing economy xvi and emerging market perspective, by highlighting the different perspectives of Internal Audit practice. Challenges that face this developing economy that are of particular interest when considering the sourcing arrangements of the Internal Audit Function, are events (political, social and economical) that have occurred in South Africa during the past 15 years. The public sector element is unique to other studies that were undertaken in South Africa.

This study examined the standing of the internal audit function in 30 of South Africa’s large listed companies as perceived by the chairs of their audit committees, their chief executive officers, chief financial officers, and chief operating officers, as well as the chief audit executives. The standing of the internal audit function in these 30 companies was based on the academic and professional qualifications profiles of the chief audit executives, the composition and qualifications of the internal audit staff complement, the independence of the function and the expectations that various stakeholders have of the function. The study reveals that the overall standing of the internal audit function in these 30 companies was perceived to be high. However, there are a number of concerning aspects that include the fact that most of the chief audit executives are qualified and registered South African Chartered Accountants (CA(SA)) and not holders of the Certified Internal Auditor (CIA) qualification. Additional concerns are that the chief audit executives’ reporting lines are not necessarily in line with currently perceived best practices; the stakeholders surveyed for this study held diverse views of the internal audit function; and in-house internal audit functions were viewed to be of a higher standing than those of outsourced functions. This study provides the internal audit profession with a scientifically researched benchmark of their status or standing in the eyes of their stakeholders and will enable them to measure changes to their status and effectiveness within their companies.

Firstly, the word KAIZEN is analysed in a theoretical part of this Master Thesis and the individual structures in organizations are described in next chapter. The requirements of relevant standards (ISO 9001, ISO 14001, ISO 27001, OHSAS 18001) are introduces, too. An audit, its types, sorts and processes of it are explained at the end of the theoretical part. A practical part contains “A project university - certifying authority – organisation”. The project deals with student´s involvement into the internal audits of selected organizations and gaining knowledge of audit processes. The project deals with competence evaluation of the internal audits´ implementation, too.

Magistro baigiamasis darbas „Audito įrodymai ir jų formavimo metodų tyrimas atliekant vidaus auditą Kauno apskrities viršininko administracijos audituotuose subjektuose“ aktualus tuo, jog audito įrodymai yra svarbus audito proceso etapas, tiek teoriniu, tiek praktiniu aspektu. Nuo jų surinkimo priklauso audito ataskaitos projekto ir ataskaitos rengimas. Teorinės bei praktinė problematikos susijusios su šiuo audito procesu apsprendė ir darbo tikslą, - teoriniu bei praktiniu aspektu ištirti audito įrodymų rinkimą ir jų formavimo problemas, Vidaus audito tarnybos darbuotojams atliekant auditą Kauno apskrities viršininko administracijos audituotuose subjektuose. Atsakant į šį tikslą formuoti uždaviniai, susiję su auditų procesų etapų analize, auditų įrodymų surinkimų sampratų tyrimu. Taip kelti uždaviniai, susiję su pagrindinio subjekto – Kauno apskrities viršininko administracijos Vidaus audito tarnybos audito įrodymų proceso tyrimu, kuriuo siekta ištirti audito įrodymų turinį, svarbą ir jų formavimo metodus. Darbe naudota lyginamoji ir literatūros analizė, apibendrinimas, indukcija, sintezė ir norminių dokumentų analizė. / Speaking in theoretical and practical terms audit evidence is important stage in audit process. Auditors gather evidence to formulate their judgment on statements and it is also important for final report. The aim of the magister theses is analysis of problems concerned with problems of the formation and gathering audits’ evidence in the Department of Internal audit in the Kaunas region Administration. The tasks of the study is to examine processes and procedures of inner audit; research of theoretical conceptions connected with gathering of audit evidence. Another aim is research of the practical problems using case analysis. The mixed qualitative and quantitative methods are used for the analyses of the problematic. The hypothesis of the research – gathering of audit’s evidence do not always correspond up the standards and requirements in the practices of Department of Inner audit. The results of the study show that there is no strong relation between the audits frequencies and opinion about the practice of gathering audit evidence. The results of qualitative research shows that Department of Internal audit in the Kaunas region Administration I effectively managed in the context of audit evidence gathering procedures (efficient training’s aims, consistent audit planning and consultation process). The research shows that critical factor in audits’ evidence gathering process is the competence of auditors. In the other hand there are some obstacles in the process of using... [to full text]

Darbe apžvelgiama Lietuvoje gautos ES finansinės paramos valdymo ir kontrolės sistema, susisteminami pagrindiniai Europos Komisijos reikalavimai kontrolės sistemai, apibrėžiamas Europos Sąjungos finansinės paramos lėšų vidaus audito vaidmuo visoje paramos lėšų kontrolės sistemoje ir analizuojamas vidaus audito pasirengimas tinkamam priskirtų funkcijų įgyvendinimui. Darbe iškelta hipotezė pasitvirtino tik iš dalies. Lietuvos valstybinio sektoriaus vidaus auditas nesuteikia pilnos garantijos, kad Europos Sąjungos paramos lėšos naudojamos teisėtai, tinkamai ir tik finansuotinoms išlaidoms dengti, dėl nepakankamų praktinių įgūdžių, nepakankamo vidaus auditorių skaičiaus, specialiųjų gebėjimų neturėjimo, nemotyvuotos mokymo politikos, netobulo veiklos planavimo. / This job reviews the system of the European Union funds control, the role of internal audit and the internal audit readiness to guarantee that the European Union funds are used legallyand properly. The hypothesis suggested at the beginning of the work proved out only partially. The internal sector of the Lithuanian state sector does not give a full guarantee that the European Union funds are used legally, properly and only in order to reimburse the costs to be financed, due to the lack of efficient practical skills, insufficient number of internal auditors, absence of special capasities, unmotivated training policy, incomplete planning of activities.