“Ditterminants Of Internal Audit Effectiveness In The Road Construction: A Case Study In Ethiopian Road Adminstration”

Abstract

The primary objective of this study is to examine the key determinants influencing the effectiveness of internal audit (IAE), with a specific focus on the Ethiopian Roads Administration. The study adopts a purposive sampling technique and utilizes structured questionnaires distributed to all internal audit staff and middle-level managers within the organization. The analysis is conducted using both correlation and regression techniques to assess the relationship and impact of five critical variables, Audit Quality, Auditor Competence, Senior Management Support, Internal Audit Independence, and the existence of an Approved Internal Audit Charter on internal audit effectiveness. The regression results reveal that all five variables have a statistically significant and positive influence on internal audit effectiveness. Specifically, higher audit quality, increased auditor competence, strong support from senior management, audit independence, and the implementation of a formally approved internal audit charter are each found to enhance the performance and value-added contributions of internal audit functions. The findings suggest that the Ethiopian Roads Administration should recognize the collective importance of these factors in improving internal audit practices and ensuring compliance with regulations and standards. Enhancing these areas will not only strengthen the internal control environment but also contribute meaningfully to good governance and transparency in the public sector. The study is valuable for academicians as it enhances understanding of the factors influencing internal audit effectiveness. Furthermore, managers can apply the study’s findings to address practical challenges affecting internal audit effectiveness, particularly within the Ethiopian Roads Administration.