Determinant Of Internal Audit Effectiveness In Non-Profit Organization: The Case Of Selected International Ngo’s In Ethiopia

Abstract

The main aim of this study was to investigate factors affecting the internal audit effectiveness in the INGOs in Ethiopia. The study adopted a cross-sectional explanatory research design whereby the researcher employed questionnaires and interviews for data collection and also a mixed research approach was used to collect and analyze primary data the sample size for this study was 54 managers, 39 internal auditors and a total of 93 employees were selected as a representative samples... The survey data were analyzed through descriptive statistics, correlation and multiple regression analysis through SPSS Version 21 software. The findings of the study indicated that management support, internal auditor’s independence, internal audit staff competence, and internal audit quality have positive and significant effect on internal audit effectiveness. From the four factors affecting internal audit effectiveness management support with beta value of 0.338 was the most influential to have positive and significant effect on internal audit effectiveness followed by internal audit quality with beta value of 0.237 and internal auditor’s independence with beta value of 0.189. Finally recommend Also Management’s commitment and support are essential as the lack of this may send the wrong signal to the auditees and affect auditees attitudes and the level of support accorded in meeting their departments' audit objectives, thereby compromising IA effectiveness and quality audit outcomes. INGOs should ensure that the audit process is carried out independently and objectively whilst ensuring that the IA department is staffed with highly qualified employees who are consistently trained and developed to conduct IA effectively.