The Effect of Internal Audit on the Financial Performance of Bureau of Finance & Economic Development of the Oromia Region State
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Date
2019-06
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Addis Ababa University
Abstract
Financial performance requires appropriate internal audit practices to improve efficiency. For the
purpose of this study the researcher sought to determine the effect of internal audit on financial
performance in Bureau of Finance & Economics Development in Oromia Region state. Internal
audit was looked at from the perspective of internal audit standards, professional competency,
internal controls, and support of management and independence of internal audit. The researcher
administered a survey questionnaire to each member of the target population since it was the most
appropriate tool to gather information. Quantitative analysis and regression analysis were used as
data analysis technique. Descriptive statistics such as mean, standard deviation and frequency
distribution were used in the analysis of data. Data presentation was done by use of tables for ease
of understanding and interpretation. From the findings, the study concludes that, independence of
internal audit, professional competency and internal control had a positive relationship and also
internal audit standards and support of management had a negative relationship with financial
performance of organization.The studied found that a unit increase in independence of internal
audit, professional competency ,internal audit standards ,support of management ,andinternal
control would lead to increase a in financial performance of organization and further unit increase
in internal control would lead to increase in financial performance of organization.From the
literature review, several researchers seem to be together that there was a relationship between
internal audit and financial performance of an organization. These conclusions would confirm
after empirical evidence would obtain from the research and not identify prefer studied how
support of management and Understanding more effective, concerns on audit software‘s Such
as IBEX, automation, fraud detection, audit exporting, data mining and network security
internal audit unit needs much more emphasis. This providing gabs to study as explain
above.The study recommends that management in organization should adopt effective internal
audit practices such as internal auditing standards, independence of internal audit, professional
competency, management support and internal controls to extend financial performance of the
Bureau of Finance & Economics Development.
Description
A thesis submitted to department of accounting and finance, college of business and economics, Addis Ababa university in partial fulfillment
Of the requirement for the degree of Master of Science in Accounting and Finance
Keywords
Financial performance, Internal audit standards, Professional competency, Support of management