دانلود رایگان مقاله انگلیسی یک مطالعه بین المللی در مورد کیفیت عملکرد حسابرسی داخلی - تیلور و فرانسیس 2018

We investigate organisational and environmental factors that influence firms’ incentives to develop high-quality internal audit functions (IAFs) by using a unique international sample formed by matching proprietary data from a global internal auditor survey with public data obtained from Worldscope. Concerning organisational factors, we find that a positive relationship exists between IAF quality and firm complexity and confirm that complex firms have a higher demand for monitoring and advising and, therefore, a greater need for formal controls. In addition, IAF quality is positively related to board monitoring and audit committee diligence but negatively associated with CEO power, which suggests that IAF quality is influenced by other key players in corporate governance. Regarding environmental factors, we document that IAF quality is positively associated with industry competition, which implies that a firm’s incentive for a high-quality IAF is enhanced when confronted with greater environmental uncertainty. Furthermore, IAF quality has a significantly positive relationship with our self-constructed index of IAF requirements included in national corporate governance codes, which indicates that strong home-country corporate governance codes play a role in fostering IAF development.

6. Conclusion

Using a unique matched sample of data that were obtained from the CBOK 2010 survey and the Worldscope database, we explore organisational and environmental factors that are associated with firms’ incentives to establish a high-quality IAF. First, we document that IAF quality is related to a firm’s operating environment, which determines the firm’s monitoring and advisory needs. The results suggest that managers and directors of more complex firms are likely to benefit more from the information gathering and assurance services that high-quality IAFs provide.

Furthermore, board monitoring incentives and audit committee diligence are positively associated with IAF quality, but CEO power is negatively related to IAF quality. Scholars argue that different corporate governance mechanisms are inter-related and that the nature of these relationships is complex, which is particularly true for an IAF, as it is expected to serve two masters, the board of directors and management (IIA 2003, Abbott et al. 2010, Hoos et al. 2014). Quality boards and audit committees understand the benefits of a highquality IAF to support their monitoring and advisory roles and demand for a high-quality IAF when the need for monitoring increases (Laux and Laux 2009); however, entrenched CEOs may limit this additional level of control that potentially constrains their ability to behave opportunistically.