The purpose of this study to identify the determinants of internal audit effectiveness in Ethiopian shipping and logistic service enterprise. The study used purposive sampling method and covered the head office and Kality branch inland transport, port and terminal. The study used mixed research approach by employing quantitative and qualitative research methods. The quantitative research method used through 104 usable self-administered questionnaires. These questionnaires were constructed in 5-point Likert scale, distributed to internal auditors, senior finance officers, and Human resources department of Ethiopian shipping and logistic service enterprise and the data analyzed using statistical package for social science software. According to the results of the study; competence of internal auditor, independence of internal audit, quality of internal audit work and audit committee were positive and statistically significant with effect on the effectiveness of internal audit ; management supports were positive but statistically insignificant with effect on the effectiveness of internal audit ; In this regard, competence of internal auditor, independence of internal audit, quality of internal audit work and audit committee were the factors determining effectiveness of internal audit in Ethiopian shipping and logistic service enterprise.