Prospect and Challenges of Performance Audit: In Case of Three Federal Public Organizations

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Addis Ababa University


The purpose of this study is to identify Prospect and Challenges of performance audit: in case of three federal public organizations. Based on literature reviews, the researcher identified three factors that challenge performance audit. This includes Auditors autonomy and interference from stakeholders, Budget and resource allocated to Audit Unit and Professional Audit standards. To this effect, descriptive survey research method with mixed research design was employed. The researcher used primary and secondary source of data in this study. To collect primary data, the researcher used questionnaires and accordingly 51 questionnaire were distributed and secondary data were collected from Ministry of Finance and Economic Cooperation inspection directorate annual report,MOFEC(2013)Performance Audit Manual, Standards and Implementation Guide, proclamations and other related documents. The data were analysed by Descriptive statics. The descriptive statistics part was analysed using mode, mean and standard deviation by using STATA software. The findings of the study revealed that top management of the public organization interfere in the work of performance auditor; the most common challenge of performance audit are in availability of sufficient manpower, inadequacy of compensation paid for auditor , non-availability of other resource, lack of knowledge, skill and experience in conducting performance audit.; lack of properly identifying high risk area and developing evaluation criteria ; Lack of proper documentation from the auditee side and Lack of clearly identifying the accountable; the leadership lack attention ,knowledge, positive outlook for performance audit. In light of the findings, the researcher recommended proper attention needs to be given by top level managers and government higher official for performance audit to bring a change in public finance.


A project paper submitted to the department of Accounting and Finance (graduate program) in partial fulfillment of the requirements of the degree of Master of Science in Accounting and Auditing


Auditors autonomy, Budget