Factors negatively affecting the relationship between internal auditors and managers

Abstract

Due to the financial disasters experienced by several companies around the world, the internal audit function has become an essential tool for the identification of fraud and corruption and also contributes to improving governance, risk management, compliance, resource conservation and verification, data analysis for the entire organization as well as the creation of added value. Except that the success of this function depends essentially on the collaboration of the managers and all the staff of the company in question. However, tensions can sometimes arise between internal auditors and managers. Thus, the purpose of this study is to test the validity of certain factors (from the literature) negatively influencing the relationship between managers and internal auditors on Moroccan territory. In particular: The dissatisfaction of internal auditors with their salary - The workload of internal auditors - The poor rating of an audited entity - The risks accepted by managers - The dissatisfaction of managers with the final result of the internal audit report - Access of internal auditors to direct communication with the audit committee. To do this, we conducted a survey based on the distribution of 40 questionnaires on internal audit practitioners, 7 of which were ignored, and 33 questionnaires duly completed with a response rate of 82.5%. The data collected was exploited by the method of multiple regression in order to examine the factors that can influence the relationship between internal auditors and managers. The results of this study showed that certain factors, including the high workload of internal auditors, the poor rating of an audited entity and the overall dissatisfaction of managers with the final result of the audit report internal audit, can create tension between internal auditors and managers. While the remaining factors, namely: Internal auditors' dissatisfaction with their salary, risks accepted by management, and internal auditors' access to direct communication with the audit committee do not have a negative influence on the relationship between internal auditors and managers.

JEL Classification : H83, M42, M49, H11, H12, L14

Paper type: Empirical research.