Factors influencing stakeholder’s judgment on internal audit function’s effectiveness and reliance

Purpose This study aims to explore the effectiveness and reliability of the performance of internal auditor by the stakeholders for their decision making. The absence of rules and regulations generates the debate that the non-standard reporting of the assessment of the internal controls system’s assessment by internal auditor and reliance by the external auditor. Design/methodology/approach The study used the mixed-method (triangulation) for the analysis quantitative data was used for regression with Smart PLS 3.2.8, and the qualitative data was used to prove and strengthen the results. The data is collected for five IVs (Objectivity of IAF, Work Performance, Competence, Internal Control System’s Assessment and Sourcing of IAF) and their impact on two DVs (Effectiveness and Reliance). This study used five areas as the target audience (Internal Auditor, External Auditor, Professional bodies, Shareholders, SECP and SBP). A total of 150 respondents were approached and received a valid response of 98 respondents. Findings The study explores the positive relationship between Objectivity of IAF, Work Performance, Competence, Sourcing of IAF on Effectiveness and Reliance. Internal Control System’s Assessment having significant relation with Effectiveness and non-significant with reliance because the absence of rules makes it unreliable for stakeholders. Originality/value The study found that the system for reporting the internal control needs rules and regulations advancement on the immediate basis for the betterment and safeguard of stakeholders to avoid the events like WorldCom and ENRON.

Skill Mismatch yang Dirasakan oleh Alumni Program Studi Diploma IV Akuntansi Politeknik Negeri Padang

Many previous studies found that there was dissatisfaction with graduate users with the competencies possessed by Accounting graduates. Importantly, Accounting graduates must prepare themselves for various competencies needed in the world of work. This purpose of this study is to examine whether there is a competency gap faced by the graduates of Accounting Department of the Padang State Polytechnic while performing their first job. This study uses a quantitative method. Sample selected purposively on the alumni of D-IV 4 Accounting at the Padang State Polytechnic with 54 respondents that had worked after graduation. The data analysis technique in this study used the sign test and the Mann-Whitney U test. The results show that there is a competency gap faced by alumni in the attributes of technical and IT skills except in presenting financial reports, planning and conducting audits, implementing internal controls, measuring company performance, using Office, accounting software and social media. There is also no difference found in competency level between graduates of 2019 and 2020.

Configuring the Enterprise Systems Portfolio: The Role of Information Risk

Information risk, the likelihood that corporate financial information is of poor quality, adversely impacts investor confidence regarding a firm’s financial health, making it an economically important problem. Viewing a firm’s enterprise systems (ES) portfolio as made up of operational modules (customer relationship management and supply chain management) and functional modules (accounting and finance, and human resource management), we examine how firms configure their ES portfolio by changing the balance in the implementation of two types of modules in response to information risk. We find internal controls to be an important contingency in determining how firms change their ES portfolio balance when information risk increases. When there is no weakness in internal controls, firms change their ES portfolio balance more toward operational modules. However, when internal controls are afflicted with material weakness, firms change their ES portfolio balance more toward functional modules instead. When evaluating the link between ES portfolio configuration and information processing requirements in the context of financial processes, managers should assess both information risk and internal controls to decide how to change the balance between operational and functional modules that are implemented.

Influence of Governance Practices on Performance of County Governments in Kenya

The Kenyan government acknowledges that there has been poor performance in the public sector over the years, especially in the management of public resources, which has hindered the realization of sustainable economic growth. Governance presents the single biggest opportunity for operational efficiency in any organization; therefore, its adoption is paramount in public sector management. The study examined the influence of governance practices on the performance of county governments in Kenya. Specifically, the study sought to establish how internal controls, stakeholder participation, internal audit standards, and transparency influence the performance of county governments in Kenya. The study employed a descriptive research design. The target population was Heads of Departments in all Ministries, Chief Officers of all Ministries, and Members of the County Assembly. A structured questionnaire was used to collect data. Data gathered from the questionnaires administered was analyzed with the help of SPSS and Microsoft Excel. The study used multiple linear regression and correlation analysis to show the relationship between the variables. The study findings indicated that internal controls, stakeholder participation, internal audit standards and transparency have a positive and significant relationship with on performance of county governments' in Kenya. The entire null hypotheses was rejected. The study recommends that the County Government should encourage stakeholders to participate by incorporating their views in governance processes. A feedback mechanism should also be delivered where stakeholders are informed of the process of their participation and the key decisions that result from the participation. Further, the study recommends that there is need for the county government to come up with its calendar of events on its activities. Keywords: Internal Controls, Stakeholder Participation, Internal Audit Standards, Transparency, Performance & County Government.

Efektivitas Pengendalian Internal Persediaan Obat-Obatan Penanggulangan Covid-19 Di Instalasi Farmasi Dinas Kesehatan Provinsi Jambi

This research aim to analyze effectiviness of internal control of Covid-19 medicine management avalibility at pharmaceutical installation of Jambi Health Departement. This research is case study research with qualitative approach. The results showed that the pharmaceutical installation of the Jambi Health Office had carried out internal controls well to protect its assets and efforts to increase its managerial activities. The Jambi Health Office Pharmacy Installation has implemented internal control based on COSO standards in managing supplies of special medicines for Covid-19 prevention properly and effectively. This can be proven by the fulfillment of the implementation of 13 indicators (87%) of the 15 COSO indicators that have been carried out by the Pharmaceutical Installation of the Jambi Health Office.

Internal Control: Its Role in the Reduction of Fraud and Professional Misconduct among SMEs

The issue of fraud and professional misconduct is a challenge to many organizations. However, the small-scale and medium-scale enterprises (SMEs) are more vulnerable. This study evaluates the role of internal control in the reduction of fraud and professional misconduct among SMEs in the Enugu metropolis. This study adopted survey research design. The research made the following major findings: that internal controls are put in place by SMEs, that internal controls are adhered to in SMEs, and that the internal controls implemented are effective in curbing fraud and professional misconduct in SMEs. Hence, the research recommend that owners and managers of SMEs should evaluate existing internal control systems and continue to implement good internal controls and ensure that proper financial records are kept and statements are prepared periodically, and small-scale enterprises that do not have internal controls should establish such and implement them to curb fraud and professional misconduct and thereby improve efficiency of operations.

Comparing the Effectiveness of Post-Scandal Apologies From Nonprofit and Commercial Organizations: An Extension of the Moral Disillusionment Model

There is a double standard in public responses to scandals: Nonprofits are penalized more harshly than commercial organizations for the same transgression (the “moral disillusionment effect”). However, previous research—focused on commercial organizations—has sometimes shown that a positive reputation can insure organizations against the negative effects of scandals. In light of this, we asked whether a second double standard exists when it comes to trust repair: Can nonprofits regain trust and consumer support more quickly than commercial organizations after apologizing? Two experiments ( combined N = 805), considering responses to sexual exploitation and fraud scandals, replicated and extended the moral disillusionment effect. Trust and consumer support were partially restored following an apology (and even a statement acknowledging the scandal without apologizing), but the rate of repair was the same for nonprofits and commercial organizations. Nonprofit managers should therefore implement internal controls to prevent violations and issue public responses when scandals emerge.

Policeman for the World: The Impact of Extraterritorial FCPA Enforcement on Foreign Investment and Internal Controls

We show that a mid-2000s increase in extraterritorial enforcement of the US Foreign Corrupt Practices Act (FCPA), characterized by greater international regulatory cooperation and more frequent use of the FCPA’s accounting provisions, has a significant deterrent effect on foreign direct investment in high-corruption-risk countries. The decrease in investment is at least as large for non-US as for US firms, suggesting that widespread extraterritorial enforcement helps to create a level foreign-investment playing field. Firms under US jurisdiction with fundamental characteristics that make it more difficult to maintain effective internal controls invest less in high-corruption-risk countries after the FCPA enforcement increase, suggesting regulatory compliance costs play a role in deterring investment. Consistent with investments in accounting systems being one way firms limit enforcement risk when investing in high-corruption-risk countries, firms pursuing new investments spend more time evaluating potential targets and firms with existing investments report fewer restatements related to unintentional errors.