Effect of Staff Competence, Task Rotation and Management Support on Internal Audit Effectiveness

Abstract

This study examines the determinants of internal audit effectiveness in a listed company. In particular, this study examines whether namely, staff competence, task rotation, and management support, influence the effectiveness of internal audit in a public listed company. Using questionnaire survey on internal audit department staff of a public listed company, the results of this study show a link between staff competence, task rotation, and management support and internal audit effectiveness. However, the results show that only staff competence and management support have a statistically significant impact on the internal audit effectiveness. The results of this study indicate that, although task rotation does not have a significant influence, this determinant is still important, as it is positively correlated with internal audit effectiveness, especially in maintaining an adequate number of competent internal audit staff. Since the correlation between staff competence and internal audit effectiveness is statistically significant, care should be taken to ensure that sufficient numbers of competent internal audit staff are available to ensure that the internal audit function is performed effectively. The results of this study also indicate that a company should emphasise ongoing management support. Hiring competent auditors, developing a growth map, and creating organisational space for auditors to work are all the result of top management decisions. In addition, a greater rotation of assignments would reduce the risk of self-review and avoid auditors' blind spots when they have to assess the same audit areas over and over again. The findings of this provide further evidences to the existing literature on the determinants of internal audit effectiveness.