Fraud is an inevitable cost of doing business. Organisations are responding to the pervasiveness of fraud by employing increased fraud risk management strategies. Internal audit is the most effective corporate control available to management to address the threat of fraud. Internal audit as an effective corporate control is studied in the context of the mandatory obligation imposed by The Institute of Internal Auditors’ 2009 International Professional Practices Framework (hereafter, IPPF). This mandatory obligation requires the internal audit function to ‘evaluate the potential for the occurrence of fraud and [to evaluate] how the organisation manages fraud risk’ (IPPF performance standard 2120.A2 Risk Management). At the individual auditor level, the internal auditor is required to ‘possess the knowledge, skills, and other competencies to perform their individual responsibilities’ (IPPF attribute standard 1210 Proficiency). These standards have the potential to increase expectations on the internal audit profession to prevent and detect the threat of fraud. This expectations gap raises two research questions: (1) What are the determinants of auditors’ fraud detection capabilities? and (2) What constitutes expert performance in the fraud detection task? This thesis aims to address these research questions through the performance of two studies. Study 1 used interviews to investigate the determinants of fraud detection capabilities of both the external auditor and internal auditor. Study 2 drew on the results from Study 1 and was an online survey of Australian internal audit practitioners. Study 1 confirmed that the determinants of auditor expert performance in other audit tasks established in literature, namely, certification, continuous learning, practical experience, analytical reasoning, data analysis skills, communication skills, are also applicable to the fraud detection task. Further, the fraud detection task requires key, unique capabilities because fraud has an inherent element of deception and concealment by fraud perpetrators. The determinants of auditor expert performance unique to the fraud detection task include mentoring, technical skills, and the ability to work in a team. An additional finding is the identification of an effective control environment as a determinant related to the environment where the auditor performs audit work. The resulting model of auditor expert performance in fraud detection depicts the relationship of these determinants (independent variables) with expert performance in fraud detection (the dependent variable). The inclusion of new determinants and the revision of the definitions of determinants established in literature provided the solution to Research Question 1. Subsequently, auditor expert performance in fraud detection was defined based on the resulting combination of determinants. This was the solution to Research Question 2. Study 2 was an online survey with new scales of measurement that were developed from Study 1 interview data. Expert studies and pilot studies were conducted to validate these new scales of measurement. The online survey captured the perceptions of Australian internal audit practitioners about the determinants identified in Study 1. The survey data was applied to the model of auditor expert performance in fraud detection. The main findings of this study are: (1) the assessment of the effectiveness of the strategies to develop auditors’ knowledge of fraud and fraud detection - mentoring, practical experience, continuous learning, and certification; (2) the assessment of the effectiveness of each determinant in contributing towards auditor expert performance in fraud detection. The findings of this thesis supported the expectation that the uniqueness of the fraud detection task impacted on the composition of auditors’ fraud detection capabilities and subsequently, the composition and definition of auditor expert performance in fraud detection. The participation of practitioners – internal auditors, external auditors, and fraud investigators - and academics in the data collection and validation processes provided valuable insight into the research design and provided helpful data for the two studies. The main contribution of this thesis is the extension of Bonner and Lewis’ (1990) model of auditor expert performance to the fraud detection task. Next, the resulting model of auditor expert performance in fraud detection provides the internal audit profession, organisations, and the individual internal auditor with an understanding of the factors that impact on the individual internal auditor’s fraud detection capabilities. Therefore, this practical understanding of internal auditors’ fraud detection capabilities has the potential to: (1) contribute to the development and improvement of an organisation’s fraud risk management strategy; (2) inform the policy debate regarding the promulgation of professional and mandatory standards; and (3) contribute to auditing practice and the audit profession through the identification of strategies to educate the audit profession about fraud detection. The final contribution is the research design where the qualitative study (Study 1) contributed to the development of the survey instrument and provided insights into the results of the structural mode (Study 2).

The purpose of this study is to provide empirical evidence relevant to perceptions of internal auditor independence. Specifically, this study investigates how the auditor practitioners (both internal and external auditors) perceive the importance of five selected factors that characterize the organizational settings of an internal audit department. Role theory is the frame of reference used to develop the conceptual model for this study in which the judgment of internal auditor independence is viewed as the role perception of internal auditors. A modified version of the Brunswik's lens model was developed to provide "paramorphic" representation of judgment of independence. The research methodology of this study is based upon a laboratory experiment in which a replicated factorial design was used to elicit the subjects' judgments of independence. The data collected from this experiment were analyzed by three statistical methods: conjoint measurement, multiple regression, and cluster analysis. The major findings follow. First, the five selected factors were not perceived as equally important by the subjects. In general, internal auditor's scope of audit. scope o^ service, and reporting level were perceived as more important than adequacy of organizational support. and formalization of audit policies. Second, the two groups of auditors disagree, significantly, on the relative importance of scope of internal audit service. Third, while large individual differences existed on the relative importance of the five selected factors, the degree of judgment consensus, in general, is high within each auditor group. Fourth, the internal auditor's perceived role conflict and role ambiguity were inversely related to his perceived level of professional autonomy. Finally, the internal auditors' judgments were not notably affected by the perceptions of their own organizational environment. However, as evidenced by the different types of experienced role conflict and ambiguity, the nature of these auditors' environment varied considerably, Given the above findings, the following implications are suggested: First, the organizational settings are critical of internal auditor independence. Improperly structured settings not only affect the perceived independence but also are detrimental to professional autonomy — de facto independence. Second, rule making bodies should provide more explicit guidelines concerning internal audit independence evaluation, particularly, in the area of scope of internal audit service. Third, while the auditor's reporting level is an important factor to independence, it should not be the only consideration. Other factors, such as the ones used in this study, should be also evaluated to avoid misleading results.

Independence and objectivity are the cornerstones of the auditing profession. Even though internal auditing is generally not mandatory for companies to set up, its importance these days has increased phenomenally due to the fact that it assists companies to systematically evaluate and improve their risk management, internal controls and governance processes. Internal auditors are therefore expected to be independent and objective in order to provide unbiased and reliable reports, and to win the trust and confidence of people though admittedly, independence and objectivity are not easy to achieve in reality since the internal auditors are employees of the company they audit and report on.  The purpose of this study was thus, to critically investigate if independence and objectivity can truly be achieved in practice by employing a case study of the Reserve Bank of Malawi (RBM). Accordingly, empirical data was gathered from the above-mentioned bank via the administration of questionnaire to seven internal auditors.  The study revealed through a qualitative content analysis of the data collected that, the internal auditors of RBM are indeed independent and objective in their profession because the bank has instituted the right organizational structures and the Internal Audit Department has made tremendous effort in complying with best practices in the internal audit profession. This has created a proper work environment as well as developed an appropriate attitude within staff that has allowed a high level of independence and objectivity to be achieved. Based on the evidence of RBM, we can therefore say that the independence and objectivity of an internal auditor can truly be achieved in practice.

This study examines how reliance on the client’s internal audit function (IAF) affects auditors’ ability to persuade management to accept material weakness assessments of detected internal control deficiencies. I further investigate whether auditors’ ability to persuade management to accept material weakness assessments depends on the subjectivity the control deficiency assessment to varied interpretations (ambiguity). I apply group affiliation and persuasion theories to hypothesize that management will have higher group identification with the IAF than with the auditors. I predict that management’s group affiliation will lead them to be more accepting of auditors’ internal control assessments when the auditors rely on the client’s IAF than when auditors do not. Further, I hypothesize that the greater the ambiguity in the internal control deficiency assessment, the more persuaded management will be to accept the auditors’ control assessment in situations where the auditors rely on the IAF than when the auditors do not. I conduct an experiment using a 2 X 2 between-subjects design in which I manipulate auditors’ reliance on the client’s IAF during tests of the client’s internal controls (rely or not rely) and the level of ambiguity in the internal control deficiency assessment (less ambiguous or more ambiguous) in a SOX 404 Internal Controls Over Financial Reporting (ICFR) audit setting. The study’s findings provide evidence that relying on the client’s IAF can improve auditors’ likelihood of persuading the client when control assessments are more open to varied interpretations. This study sheds light on a previously ignored benefit of using the client’s IAF – as a persuasion tactic. Thus, my research contributes to two literature streams: factors influencing auditor-client negotiations and the effects of using the IAF on audit engagements. These results provide both practical and theoretical insights to academics, practitioners and auditing standard setters.

The thesis mainly studies, the relevant influential variables of the internal auditors¡¦ concentration on jobs and their efforts for the work, in consideration of the internal auditors¡¦ individual factors, which affect WV and JC; furthermore with an empirical survey and statistical analysis by SPSS program on the working attitude¡¦s influence on the JI and ITQ. The critical findings of the thesis are as follows: (1) Individual characteristics¡Ðsex, age, marrage, years of employment, reason of being an auditor, position, have obvious differentiations respectively on the partial dimensions of the internal auditors¡¦ WV. (2) Individual characteristics¡Ðage, marrage, education, years of being an auditor, reasons for being an auditor, position, certification of accounting/auditing, span of incremental salary, have obvious differentiations respectively on the partial dimensions of the internal auditors¡¦ JC. (3) Individual characteristics¡Ðage, years of employment, reasons for being an auditor, position, span of incremental salary, have obvious differentiations on the internal auditors¡¦ JI. (4) Individual characteristics¡Ðage, sex, years of employment, years of being an auditor, organization¡¦s capital amount, have obvious differentiations on the internal auditors¡¦ ITQ. (5) The whole WV have obviously positive correlation on internal auditor¡¦s JI. In details, the two dimensions of inner value and social status value have obviously positive effect with internal auditor¡¦s JI. (6) The whole JC have obviously positive correlation on internal auditor¡¦s JI. In details, except for task identity, the other four JCs have obviously positive effect with internal auditor¡¦s JI. (7) In order to decrease ITQ of the internal auditors, organization ought to upgrade the JI of internal auditor, especially put much emphasis on the compensation of the internal auditors; and directly expand the task variety and task proactiveness would also obviously decrease the internal auditor¡¦s ITQ. (8) In order to upgrade the internal auditors¡¦ JI or decrease their ITQ, the interaction of the different JC and individual WV would indicate the outcome of facilitation or suppression to main effects with interference.

This diploma work treats about external and internal auditor in the complex. First of all it focuses on characteristics of personality, then on their education and practise of profession. There is also a part devoted to organizations which associate them. At the close it analyses their common features and differences.

Diploma thesis discusses questions about internal audit. I have focused on internal audit in the bank. I analyzed four czech banks if they had established internal audit section and Audit Comitee and how many internal auditors they employ. In the second practical part I described internal audit as a process. I demonstrated it on the internal audit of mortgage credit process.

<p>Audit is a common concept in Sweden. This occurs in many contexts and situations and may intend a wide spectrum of areas. It might consider environment audit, amateur audit, internal auditing, external audit etc. In the business community external audit and the associated external auditor is possibly, from the general public's side, the most recognized. The external audits purposes in big features are checking limited companies economic accounting along with the board and CEO: s management. In connection with increased requirements from the market, the own ranks and a row scandals where companies consistently created misled accounting which the external audit never detected, the internal auditing has grown himself stronger as well international as in Sweden. The internal auditing will according to their instruction from the company’s management in the specific company se to that nothing of the above occurs. Instead, this function will contribute to that the company is govern in better ways with fewer mistakes and a more reliable accounting as well financial as general. A big difference between the external audit and the internal audit which this thesis basically builds on is the theoretical knowledge that one is required to posses in order to conduct external opposite internal audit. In order to conduct external audit, the auditor need to, as described in Swedish legislation, hold a certain number academic points in specified subjects. The internal auditor however doesn´t have this kind of rules to follow. So how is quality in a function is that alone works with quality assurance assured? Well, through its own world extensive interest association, IIA, The Institute of Internal Auditors agency. This association provides a certification that persons that work with internal auditing can undergo. This certification which is standardized around in the entire world, is suitable to give the internal auditor fundamental knowledge of its intention and also to seem as a quality assurance for the internal auditing around in the globe. This certification is however rather extensive and requiring for the student. In Sweden only a minority of the internal auditors has undergone it. This thesis, which examine possible factors to why internal auditors choose to undergo this certification intend to answer this fact and the result that arrives is as follows:</p><ul><li>The employer requires this. </li><li>The employee wants to market her/him on the labor market, often on an international such. </li><li>The employee is on the verge to start up and the lead the organization in a new internal auditing department. </li></ul> / <p>Revision är ett vanligt förekommande begrepp i Sverige. Den förekommer i många sammanhang och situationer och kan avse ett vitt spektra av områden. Det kan handla om miljörevision, lekmannarevision, internrevision, externrevision etc. I den ekonomiska sfären av näringslivet är externrevision och den därtill hörande externrevisorn möjligen den, från allmänhetens sida, mest igenkända. Externrevisionen går i stora drag ut på att granska aktiebolags ekonomiska redovisning samt styrelse och VD:s löpande förvaltning av detsamma. Med anledning av höjda krav från marknaden, de egna leden samt en rad skandaler där företag konsekvent skapat vilseledande bokföring vilken revisionen inte upptäckt, har internrevisionen vuxit sig allt starkare såväl internationellt som i Sverige. Internrevisionen skall på uppdrag av företagsledningen i det specifika bolaget tillse att inget av ovanstående inträffar. Istället ska funktionen bidra till att företaget leds på ett bättre sätt med färre misstag och en mer pålitlig redovisning såväl finansiell som allmän. En skillnad mellan externrevisionen och internrevisionen vilken uppsatsen i stort bygger på är de teoretiska förkunskaper som krävs för att utöva dem. För att utöva externrevision finns det stadgat i lag och förordning att personen ska inneha ett visst antal akademiska poäng i på förhand specificerade ämnen. Internrevisorn har emellertid inte detta av lag stödda kravet. Hur kvalitetssäkras då en funktion som själva arbetar med kvalitetssäkring? Jo genom sin egen världsomfattande intresseförening, IIA, The<strong> </strong>Institute of Internal Auditors försorg. Förening tillhandahåller en certifiering vilken personer som arbetar med internrevision kan genomgå. Certifieringen är standardiserad runt om i världen och är avsedd att ge internrevisorn grundläggande kunskaper men avser även att verka som en kvalitetssäkring för internrevisionen runt om i världen. Certifieringen är emellertid tämligen omfattande och krävande för studenten och i Sverige är det endast en minoritet av internrevisorerna som genomgått den. I uppsatsen undersöks en rad tänkbara faktorer till varför internrevisorer väljer att genomå certifieringen och resultatet som framkommer är att:</p><ul><li>Arbetsgivaren ställer det som krav </li><li>Arbetstagaren vill marknadsföra sig själv på arbetsmarknaden, ofta på en internationell sådan.</li><li>Arbetsagaren ska starta upp och leda arbetet på en nystartad internrevisionsavdelning. </li><p> </p></ul>

Audit is a common concept in Sweden. This occurs in many contexts and situations and may intend a wide spectrum of areas. It might consider environment audit, amateur audit, internal auditing, external audit etc. In the business community external audit and the associated external auditor is possibly, from the general public's side, the most recognized. The external audits purposes in big features are checking limited companies economic accounting along with the board and CEO: s management. In connection with increased requirements from the market, the own ranks and a row scandals where companies consistently created misled accounting which the external audit never detected, the internal auditing has grown himself stronger as well international as in Sweden. The internal auditing will according to their instruction from the company’s management in the specific company se to that nothing of the above occurs. Instead, this function will contribute to that the company is govern in better ways with fewer mistakes and a more reliable accounting as well financial as general. A big difference between the external audit and the internal audit which this thesis basically builds on is the theoretical knowledge that one is required to posses in order to conduct external opposite internal audit. In order to conduct external audit, the auditor need to, as described in Swedish legislation, hold a certain number academic points in specified subjects. The internal auditor however doesn´t have this kind of rules to follow. So how is quality in a function is that alone works with quality assurance assured? Well, through its own world extensive interest association, IIA, The Institute of Internal Auditors agency. This association provides a certification that persons that work with internal auditing can undergo. This certification which is standardized around in the entire world, is suitable to give the internal auditor fundamental knowledge of its intention and also to seem as a quality assurance for the internal auditing around in the globe. This certification is however rather extensive and requiring for the student. In Sweden only a minority of the internal auditors has undergone it. This thesis, which examine possible factors to why internal auditors choose to undergo this certification intend to answer this fact and the result that arrives is as follows: The employer requires this. The employee wants to market her/him on the labor market, often on an international such. The employee is on the verge to start up and the lead the organization in a new internal auditing department. / Revision är ett vanligt förekommande begrepp i Sverige. Den förekommer i många sammanhang och situationer och kan avse ett vitt spektra av områden. Det kan handla om miljörevision, lekmannarevision, internrevision, externrevision etc. I den ekonomiska sfären av näringslivet är externrevision och den därtill hörande externrevisorn möjligen den, från allmänhetens sida, mest igenkända. Externrevisionen går i stora drag ut på att granska aktiebolags ekonomiska redovisning samt styrelse och VD:s löpande förvaltning av detsamma. Med anledning av höjda krav från marknaden, de egna leden samt en rad skandaler där företag konsekvent skapat vilseledande bokföring vilken revisionen inte upptäckt, har internrevisionen vuxit sig allt starkare såväl internationellt som i Sverige. Internrevisionen skall på uppdrag av företagsledningen i det specifika bolaget tillse att inget av ovanstående inträffar. Istället ska funktionen bidra till att företaget leds på ett bättre sätt med färre misstag och en mer pålitlig redovisning såväl finansiell som allmän. En skillnad mellan externrevisionen och internrevisionen vilken uppsatsen i stort bygger på är de teoretiska förkunskaper som krävs för att utöva dem. För att utöva externrevision finns det stadgat i lag och förordning att personen ska inneha ett visst antal akademiska poäng i på förhand specificerade ämnen. Internrevisorn har emellertid inte detta av lag stödda kravet. Hur kvalitetssäkras då en funktion som själva arbetar med kvalitetssäkring? Jo genom sin egen världsomfattande intresseförening, IIA, The Institute of Internal Auditors försorg. Förening tillhandahåller en certifiering vilken personer som arbetar med internrevision kan genomgå. Certifieringen är standardiserad runt om i världen och är avsedd att ge internrevisorn grundläggande kunskaper men avser även att verka som en kvalitetssäkring för internrevisionen runt om i världen. Certifieringen är emellertid tämligen omfattande och krävande för studenten och i Sverige är det endast en minoritet av internrevisorerna som genomgått den. I uppsatsen undersöks en rad tänkbara faktorer till varför internrevisorer väljer att genomå certifieringen och resultatet som framkommer är att: Arbetsgivaren ställer det som krav  Arbetstagaren vill marknadsföra sig själv på arbetsmarknaden, ofta på en internationell sådan. Arbetsagaren ska starta upp och leda arbetet på en nystartad internrevisionsavdelning.

本研究之目的在於瞭解適任的內部稽核人員應具備之人格特質與技能，並探討這些人格特質與技能是否受到產業別或機構特性之影響。本研究以參加中華民國內部稽核協會例會活動之內部稽核人員為對象，於活動現場發放並回收研究問卷，以獲得相關的實證資料。 根據實證結果，本研究的主要發現與結論如下： 1.適任的內部稽核人員應具備「勤勉審慎性」之人格特質，以及「分析性技 能」與「判斷性技能」。 2.電子業內部稽核人員重視「外向性」之人格特質的程度高於金融業內部稽核人員，且較其它產業更為重視「自我調適與人際溝通技能」。 3.稽核主管重視「和善性」及「經驗開放性」兩大人格特質及「分析性技能」的程度高於非稽核主管。 4.公司營收在40億元以上之稽核主管，對其實際具備相關技能之程度最有自信。 5.稽核單位整體具備的技能低於稽核人員實際具備之技能，反映填答者對本身實際具備之技能較有信心，而對稽核單位整體具備之技能的看法則較為保守。 / The purpose of this study is to understand the personality traits and skills that a competent internal auditor should possess and to examine the industry and firm effects on these traits and skills. By means of distributing the research questionnaire to the internal auditors attending the IIA-Taiwan monthly meetings, this study gathers related data and perform various analyses. Our empirical results show that: 1. A competent internal auditor should possess the traits of conscientiousness, and the analytic and appreciative skills. 2. Internal auditors of the electronics industry attach more importance to the extraversion traits than those from the financial industry, and value the personal and interpersonal skills more than those auditors from other industries. 3. Chief audit executives (CAEs) value the agreeableness and openness to experience traits, and the analytic skills more than non-CAEs. 4. CAEs from the companies with operating revenue over forty billions NT dollars are most confident with the skills that they possess. 5. Most respondents believe that his/her internal audit department’s level of skills is less sufficient than that of individual auditors.