A New-style Internal Auditing： The Governance-oriented Internal Auditing

The transformation of internal auditing （IA） from the function of supervision, management and control-oriented to governance-oriented are fulfilled while governance-oriented internal auditing emerging from the demand of corporate governance. The governance-oriented internal auditing （GOIA） is a risk-based assurance and consulting activity designed to add value into the organization focusing on the effectiveness of corporate governance in supervision and assessment by compound professional aims. Governance-oriented internal auditing includes board auditing, strategic auditing, management responsibility auditing and risk management auditing, etc..

Does the Internal Audit Function Play a Role in Mitigating Earnings Management?

This paper aims to investigate the effect of the characteristics of the internal audit function(IAF)on earnings management(EM)for a sample of 27 Tunisian listed companies.The authors employed the Correlated Panels Corrected Standard Errors model to estimate the regression equation.The results showed that EM is negatively associated with internal audit effectiveness,frequency of audit committee meetings with Chief Audit Executives(CAEs),the partial outsourcing of internal audit,and the firm’s size.Moreover,the authors found a positive relationship between EM and the use of IAF as a training ground for management and the private sector.This study is important to academics,regulators,and policymakers in introducing new governance reforms to strengthen the IAF as an important internal governance mechanism to reduce earnings management practices in emerging countries.The results also provide useful information for investors to examine the effect of internal audit characteristics on earnings management.

Exploring the Internal Audit Practices of Electric Power Enterprises in the Context of the New Economic Normal

In the current economic landscape characterized by a decelerating domestic economy,rising investments,and an extended project construction timeline,power generation enterprises must enhance their internal audit efforts to sustain their competitive edge in business development.Addressing systemic shortcomings methodically and practically can enhance the internal audit effectiveness within electric power enterprises and contribute to the steady enhancement of their production and operation performance.

Research on Firm Size, Firm Performance and Internal Auditing Modes——Based on Listed Manufacturing Companies of China

This paper is based on the samples of listed manufacturing companies of China, taking the financial performance as criterion, and then does research on the firm performance with different internal auditing modes, using Cross-sectional data to analyze the distribution of internal auditing modes and the characteristics of the firm performance. The conclusion is that setting up internal auditing is good for the development of companies, but the function of internal auditing has not been widelv fulfilled.

A Comparative Study about Internal Auditing Approach between Germany and China

While internal audit is one of the most important functions and procedures for internal control of the firms＇ normal operations from the perspective of financial terms, different countries, due to their stages of economic developments （developed countries VS. developing countries）, unique governmental regulations, and different societal and cultural traditions, have implemented different internal audit systems and approaches. This paper describes a comparative study exploring some key differences between the internal audit system in China and its counterpart in Germany---from the following five important aspects： the origin and development of internal audit, the structure of internal audit system, the relationship between firms＇ internal audit and the government agency, the responsibility and accountability of internal audit, and the quality of internal auditors. Based on the comparative analysis, four suggestions are made for future improvement on the internal audit system in China, along with managerial discussions.

On Outsourcing Internal Auditing

There is an ever growing tendency of outsourcing of internal auditing since the appearing of it in 1970s.The paper introduces the status quo and form of outsourcing of internal auditing and analyzes the advantage and disadvantage of it in western nations in order to offer references for the development of internal auditing in our nation.

Quality of Accounting Information and Internal Audit Characteristics in Nigeria

The basic goal of accounting is to provide quality accounting information that will aid reliable decision-making. The quality level of this accounting information comes from the company＇s governance practices, thereby emphasizing the importance of corporate governance in companies. Recently, following the financial crises resulting in accounting scandals, attention has been moving towards internal audit function as an important factor in the structure of corporate governance. This paper therefore examined the extent of the relationship between internal audit function and the quality of accounting information of companies. The study adopted the survey research design. The research instrument employed was questionnaire which was administered to internal auditors of the ＂Big Four＂. Linear regression analysis was employed in the analysis of the data collected with the use of Statistical Packages for Social Sciences （SPSS）. The results revealed that there is a significant relationship between the internal audit characteristics and the quality of accounting information. It was recommended that in order to provide credibility to the financial statement, there should be a law in place mandating attachment of internal auditors report to the financial statement.

The effectiveness of internal audit in Malaysian public sector

Internal audit in Malaysian public and private sector organizations underwent a steady organic growth since gaining a foothold in the management process in the 1970s. The management of the Malaysian public sector is continuously maturing in facilitating foreign input in national development, echoing similar advances expounded by the internal audit units of private sector organizations. The main difference being the public sector addresses the interest of a much wider group of stakeholders. Rapid development in infrastructures and industries positioned Malaysia on the fringes of globalization and the world market. This enlarges the crucial role of internal auditing to ensure transparency, integrity, quality and improved service delivery; among myriad positive aims, remain the end point of any process area. This study explored the significance of internal auditing in the Malaysian public sector, and its subsequent extent and influence in public sector hierarchy and decision making. Data was collected from responses to a questionnaire distributed to head of internal auditors, internal auditors and other staff of internal audit departments from various categories of public sector departments and agencies in Malaysia. The study concluded that the internal audit function in the public sector in Malaysia is curtailed by understaffing and hampered by inadequate support from top management while, the auditors seldom extend their full cooperation. The auditors themselves lack appropriate knowledge and training on effective auditing approaches. The negative perception accorded to internal audit led to inaction by management on recommended remedies which only serve to nullify the positive contribution internal audit potentially holds to elevate the service delivery quality of the public sector.

Game analysis on the regulation of listed companies＇ accounting information-gaming between Internal Audit Department and Audit Office

Through the establishment of game model, this article formulates the intuitive and experiential understanding of regulation on listed companies＇ accounting information by using game analysis method, and from an economic point of view, it analyzes how various parameters affect Internal Audit Department＇s nonfeasance probability and Auditing Office＇s supervision probability. Hope that this article can provide a reference for regulation on accounting information.

The Effect of Audit Objectives on Audit Quality Why is There Little Disclosure of Significant Deficiencies in Japanese Internal Control Audits？

Many prior research findings indicate that audit quality differs between the Big 4 and non-Big 4 audit firms using an indicator variable. However, most previous research focuses on only outcome measures, such as audit fees, going concern reports, and non-audit services. This study investigates audit quality differentiation between the Big 4 and non-Big 4 audit firms hypothesis from an audit objective point of view. One of the material objectives of Japanese internal control audit institutions is to facilitate assessment and improvement of internal controls by corporations themselves. The findings of this study indicate that the Big 4 audit firms accomplish this objective better than non-Big 4 audit firms. Consequently, most Big 4 clients do not disclose significant deficiencies （SDs）, implying that they improve the quality of internal controls through internal controls auditing. This paper concludes that Big 4 firms produce a higher audit quality level than non-Big 4 firms, and this quality difference iS related to how an audit objective is interpreted and implemented.

Internal Control and Internal Audit in the Function of Supervising the Operations of Companies

The management of a modern company is faced with the need to make business decisions regarding the achievement of business goals.Increased interest in establishing internal control is affected by the presence increased corruption and the erosion of business morality.For internal controls,everyone is interested,from external auditors to management,board of directors,shareholders of large public companies and the state.With the constant growth of the company,the decentralization of business has been compounded by the management process.Therefore,in addition to internal control,internal audit is required.The company’s management cannot deal with oversight because it has to deal with strategic issues.This is where internal audit is performed as an expert service.The results of the conducted empirical research showed that the stages of development of internal control in enterprises in Montenegro do not correspond with the achieved degree of development of this profession in the countries of the developed market economy.

From the Opacity of Internal Control to the Effectiveness of Legal Audit: Analysis of Issues and Determinants in Business in Cameroon

Legal audit is a statutory control of the accounts carried out based on internal control(IC).Meanwhile,paradoxically,IC is not always transparent to the legal auditor,but rather a compromise to his expectations.What are the determinants that allow the auditor to adapt to it?This paper proposes the analysis of issues and determinants of the effectiveness of legal audit in the context of an opaque IC.This study is carried out on a sample of 56 limited liability companies in Cameroon,carefully selected based on the existence of an IC service.The determinants explaining the auditor’s effectiveness in his mission are noted.

Financial Management and Control and Internal Audit System in the Public Sector in BiH

The introduction and implementation of finansijsko upravljanje i kontrola(FUK,financial management and control[FMC])in Federation of Bosnia and Herzegovina(FBiH)aims to incorporate a modern public internal financial control(PIFC)system into traditional public resources management models.This area is one of the reform areas in which Bosnia and Herzegovina(BiH)is obliged to harmonize the legislative framework and practice with the good practices and regulations recommended by the European Commission.The establishment and development of the PIFC are also an obligation of Bosnia and Herzegovina established by the Stabilization and Association Agreement between the European Community and the member states,of the one part,and Bosnia and Herzegovina,of the other part.The public internal financial control(PIFC)system focuses on enhancing transparency,financial discipline,and dedicated use of public resources,that is,transparent,economical,efficient,and effective management of public resources,and control of the use of those resources.The topic of this paper is“financial management and control in the public sector”where the aim is to show,through the conducted theoretical research,the level of achievement of the establishment of this system in public sector institutions in BiH.The European Union wants to direct all potential member countries towards development of internal controls in the use of their own resources,but also to create a control environment that would ensure the dedicated use of EU funds.In Bosnia and Herzegovina,there is no single legal framework in terms of a single law governing public internal financial controls.The contents of the applicable legal provisions at all three levels(BiH,FBiH,and Republic of Srpska[RS])are largely congruent thanks to the Coordination Committee of Central Harmonization Units(CHJs)in Bosnia and Herzegovina,through which the harmonization of regulations and practices in the development of public internal financial controls is ensured.

Corporate Governance Principles Introduced by the Capital Markets Board of Turkey and an Investigation About Internal Audit in Companies Listed on Borsa Istanbul

Today＇s global trends need to be clearly explained to enable the efficient functioning of capital markets for the purpose of the country＇s economic development. Promotion of a strong internal audit function plays a key role in assisting the board to discharge its governance responsibilities. The internal audit needs to exert its important function for refining corporate governance procedures, improving internal control, and strengthening risk management. The rules concerning internal auditing issued by the Banking Regulation and Supervision Agency, Capital Markets Board of Turkey, and other public societies have contributed to the development of internal auditing in Turkey. The Capital Markets Board of Turkey published “Communiqu6 Serial： IV, Noi 56 on Identification and Application of Corporate Governance Principles” （Official Gazette dated December 30, 2011, No. 28158）. In Part 4.2.4 of these principles, it was stated that “The board of directors supervise the efficiency of risk management and internal control systems at least once a year. Information about existence, operation, and efficiency of internal control and internal audit is given by annual report”. The objective of this study is to analyze the structure of internal audit function-related information on the annual reports of companies that are included in the Borsa Istanbul. Annual reports of 192 manufacturing companies listed on Borsa Istanbul were examined by content analysis method.

Joseph Hardy Ltd.： Internal Audit for Performance Improvement

This paper features a case study, which looks at the use of financial and non-financial indicators （NFIs） of performance in the monitoring of a production process. It highlights the apparent deficiencies in the use of some indicators and provides opportunities for the implementation of preferred alternatives and for improvements in the organization and evaluation of the production process.

Establishment of Effective Internal Audit Function： Recommendations for Best Practice

This paper^1, which is in the light of the last trends in internal auditing, aims to explain the challenges and major issues in establishment of an effective internal audit （IA） function to achieve value-added IA activities as a value-added service center. This paper also discusses the current internal auditing environment in Turkey considered for the needs and expectations of stakeholders and new legislations. In the next five years, five emerging activities for internal auditing may be taken into consideration, namely, the review of corporate governance process, auditing of enterprise risk management （ERM） processes, addressing linkage of strategy and company performance, the ethics audits, and the migration to International Financial Reporting Standards （IFRS）, they will be the major focus areas for internal auditing. The qualifications of IA staff, status within the corporation, setting up of the functional and administrative reporting lines, relationship with the audit committee of the board of directors, and the content of IA charter must be sufficient for assurance of the IA function＇s effectiveness and objectivity. The effective communication channels among management, audit committee, and IA become more important and must be operated in a consistent manner that accurately contributes to preventing potential future financial crisis and the effectiveness of risk management （RM）. Ten main imperatives of change for IA can be summarized as emphasizing RM and governance, addressing key stakeholder priorities, and optimizing IA resources. Based on professional practices, international standards of Institute of Internal Auditors （IIA）, best practices, and the relevant recommendations have been made by the authors for practitioners and stakeholders.

Analysis of the Impact of the New Financial Accounting System on the Internal Audit of Colleges and Universities

The new financial accounting system is the reorganization and refinement of the contents of the old financial accounting system, which not only maintains the basic contents of the original system, but also has its new characteristics. As far as the applications of the new accounting system are concerned, its practicability is very strong, and especially the application of the accounting in colleges and universities is very convenient. Moreover, the levels of the financial management under the new financial and accounting system are gradually improving. The purpose of this article is to explore the impact of the new financial accounting system on the internal auditing work in colleges and universities, hoping that this research will be helpful to the related auditing work in colleges and universities in the future.

Characteristics of Audit Committee and Effectiveness of Its Internal Control

The Audit Committee is a very important part in the enterprise, its main role is on behalf of the Board of Directors to review, monitor and evaluate the cotnpany＇ s internal control. Playing the role of the audit committee can help prevent the economic crisis because of poor management, prevent the phenomenon of corporate embezzlement and accounting fraud. It is an important role in internal control. The thesis begins with an introduction to the Audit Committee, and analyzes the characteristics of Audit Committee and effectiveness of internal controls.

Internal Audit and Risk Analysis:The Particular Case of a Public Entity in Portugal

The purpose of this paper is to present the results obtained by an internal audit unit of a large public sector entity,in the area of education,during 2018,which we will call here Entity X and analyze the impact that developed work had in the management decisions of that entity.The methodology used in the preparation of the article is the case study,where Cervo,Bervian,and Silva(2007,p.62)define it as“research on a particular individual,family,group or community that is representative of their universe,to investigate the different aspects of life”.The theoretical framework on the theme(secondary sources)was developed from bibliographic and documentary research,which concerns the classification of procedures and are appropriate to the characterization of this study,as an instrument for collecting information on the subject in question(Gil,2006).The results obtained are related to the activity of the referred internal audit unit in 2018,which proved to be quite fruitful and are developed in points 4,5,and 6 of the paper.During the preparation of the study,some limitations were found,related to the fact that it was only possible to analyze the year 2018,thus failing to establish a relationship with the department’s activity history.In our opinion,this study is important because it allows other similar entities to verify that it is possible to carry out internal auditing in the public sector(especially in this sector of education),since this practice is not yet disseminated within the area.This study is original in that it uses real data from an internal audit body.

The Self-inspections(Internal Audits)Process as a Part of the Pharmaceutical Quality System:Formation of a Risk-Based Approach to Internal Audits Planning

The quality system of any modern pharmaceutical company is the pharmaceutical quality system(PQS),which extends the GMP standards to all stages of the medicinal productslife cycle,from pharmaceutical development to its withdrawal from production.The principal difference between PQS and GxP rules from other quality systems is that the medicinal product,its safety and efficacy is put at the forefront.At the same time,PQS implies a process approach to all components that should be aimed at achieving the main goal—ensuring and guaranteeing the quality of the medicinal product for the end user(patient)—and should be based on the quality risk management system.An integral part of PQS,as well as the GxP rules adopted in the European Union and PIC/S,is a process for self-inspections and/or quality audits,which regularly appraises the effectiveness and applicability of the PQS.This publication is dedicated to the definition of self-inspections(internal audits)as one of the PQS’s processes.The article defines the main standard stages and develops a model of a risk-based approach to the self-inspections’planning in relation to processes of the pharmaceutical quality system.