Professional Documents
Culture Documents
5/5/2009
SCHOOL OF BUSINESS, UNIVERSITY OF CAPE COAST, GHANA
ISHMEAL OFORI AMPONSAH (STUDENT)
Introduction
All over the world there is a realization that the Internal Audit activity has the potential to
provide hitherto unparalleled services to management in the conduct of their duties. This
potential has been turned into a challenge and embodied in the new definition of Internal
The Government of the Republic of Ghana by the Internal Audit Agency A ct, 2003 (Act 658)
established the Internal Audit Agency “as an apex oversight body to co-ordinate, facilitate and
provide quality assurance for Internal Audit activities within the public sector” (Section 16 of Act
658). The Internal Auditor’s value lies in how well he has been able to contribute to the
achievement of the overall organisational objective. The Internal Auditor should constantly seek
to make himself relevant to his organisation by providing information that will make
management take decisions that impact positively on their ability to achieve the organisational
goals.
However, according to research and surveys conducted by Deloitte & Touche (2004) and the
Internal Audit Agency of Ghana (2006), much of the work of Internal Audit has been very
restrictive in terms of scope. This needs to be addressed if the required return on investment in
Public sector managers do not support Internal Audit. The Internal Audit function in the
Ghanaian public sector faces a perception and, to some extent, a credibility problem as a value-
adding unit of the organisation. The Internal Audit Agency (2006) believes that the importance
down the importance of Internal Audit as a key function that can strengthen the oversight
responsibility of the governing body. This reflects in the management attitude towards the
Internal Auditor. Most often than not the budget of the Internal Audit Unit, if any exist at all, is
woefully inadequate to enable them meet the resource requirements of their annual audit plans.
Internal Auditors are seen more as fault finders rather than solution providers and partners in the
Management Question: Why do public sector managers fail to support the Internal Audit
Research Questions:
1. What account for the low support for Internal Audit by public sector managers?
2. What actions are necessary to get the support of management of internal auditing in the
public sector?
3. Is there a link between the quality of service the Internal Auditor provides for his
organisation and the attitude of managers towards the Internal Audit function?
Hypothesis:
There is no relationship between the quality service Internal Auditors provide for their
organisations and the attitude of managers towards the Internal Audit function.
1. Examine the factors responsible for the low support for the Internal Audit Activity by
Activity.
3. Establish the relationship between quality of service and support of managers for Internal
Audit.
Significance of Study
1. Improve public understanding of the role of the Internal Auditor in the achievement of
organisational objectives.
2. Improve literature on public sector Internal Auditing in Ghana.
The Government of Ghana has taken a proactive step in establishing the Internal Audit Agency
(The Agency) by an Act of Parliament in 2003. The IAA is mandated to co-ordinate, facilitate
and provide quality assurance for internal audit activities within the public sector institutions (the
IAA Act 2003, Act 658). The Agency has formulated three strategies which it is currently
pursuing to improve the image of the Internal Audit function in the public sector. These are as
follows:
1. Professional Practice Framework which aims at developing key documents and templates
for use by the Internal Audit function such the Internal Audit Regulations, Internal
Auditing Standards, Audit Programmes Internal Audit Charter and Annual Audit Planning
templates.
2. Human Resource Development which seeks to facilitate the recruitment, training and
assurance and consulting activity designed to add value and improve an organization’s
disciplined approach to evaluate and improve the effectiveness of risk management, control, and
within an institution as against the previous orientation of reviewing payment transactions over
the years. Modern internal audit covers (or should cover) all activities of the organisation.
Therefore the scope of internal audit is no longer restricted to the processes and systems in the
The value of the modern day internal auditor lies in his ability to help management to achieve its’
objectives. According to a research jointly conducted by Deloitte & Touche and the Institute of
Internal Auditors, U.K., (2004) “improved attitudes toward internal audit are built on a belief that
internal audit functions are creating greater value for their organisations”.
Governance refers to all the strategic plans of the organisation to demonstrate its commitment to
quality and excellence. They reflect the strategic thinking and orientation of the Board and
Management to achieve the objectives of the organisation. However, every decision and
with the implementation of programs. Some of the risks are reputational, financial, operational,
and information technology related. It would therefore be appropriate to have a structured way of
identifying events that would impact negatively on the ability of management to achieve their
objectives and also to take advantage of opportunities and other events that could be leveraged to
achieve those same objectives. i.e. an integrated risk management framework that is embedded
in the planning process of the organisations. Internal Auditors are experts in creating and
promoting a risk management culture that is necessary to the effective implementation of the risk
This section presents an overview of the methods to used in the study. Areas covered include the
research design, population, sample and sampling techniques, data collection and analysis.
Research Design
The study will involve the evaluating the role of Internal Auditors in the good governance of the
organisations in the public sector. Consequently, the research will be designed to achieve the
Population
The public sector of Ghana is the biggest employer of Internal Auditors and involves several
organisations including Ministries, Departments and Agencies (MDAs). The public sector also
includes Metropolitan, Municipal and District Assemblies MMDAs). The targeted population
It obvious from the definition of the population above that a census is not feasible in this study.
Accordingly, the researcher will adopt the survey type of research in which a sample from the
target population will be used for the study. In total, a sample of 185 elements will be selected
population will be divided into MDAs and MMDAs. Next, the MDAs will be grouped into
Ministries, Departments and Agencies and the MMDAs into Metropolitan, Municipal and
Districts. This will ensure a fair representation of each group of institutions since their
Data Collection
The focus of study is on attitudes and perception and the importance of primary data cannot be
over-emphasised. However, secondary data will also be collected to augment the studies.
Before the actual data collect the researcher will collect introductory letter from the School of
Business of the University of Cape Coast to the sampled institutions. The initial visit to the
selected institutions will therefore be to introduce himself, familiarize himself with those
The researcher will collect data by administering a questionnaire. The questionnaire will use
structured questions, consisting of approximately 20 questions divided into three sections ‘A’,
‘B’, and ‘C’. Section ‘A’ will consist of seven questions seeking to answer the first research
question. Section ‘B’ will consist of six questions covering the second research question whereas
Section ‘C’ will consist of questions to test the hypothesis and also answer the third research
question.
questions.
Most of the structured questions will be the close-ended type and respondents will be asked to mark the
appropriate box matching the correct answer. Other questions, however, will require respondents to
give opinions.
The responses to the structured close-ended questions will be rated in percentages. The
percentage of respondents for each alternative will be given and analysed. The data collected
will be analysed using the computer software known as Statistical Package for Service Solution
(SPSS).
Timescale
October 2009: agree formal access to organisations for collection of primary data
Limitations
The researcher cannot cover all the ten regions of Ghana. The research will therefore be restricted to five
The Institute of Internal Auditors (the IIA). (2007), The Professional Practices Framework.
Florida, U.S.: The IIA Research Foundation.
Spencer, P. K. H. (2003), The Internal Auditing Handbook. U.K. City University Press.
Deloitte & Touche Enterprise Risk Services & Institute of Internal Auditors – UK and Ireland
(2004), The Value Agenda. Available at www.iia.org.uk, (Accessed on 14 April 2009).
Internal Audit Agency, Republic of Ghana. (2007), Annual Report to the Office of the President.
Accra: the IAA
Saunders, M., Lewis, P., & Thornhill, A. (2007), Research Methods for Business Students (4th
ed.) Harlow, England: FT Prentice Hall
Blumberg, B., Cooper, D.R., and Schindler, P.S. (2005) Business Research Methods,
Maidenhead, McGraw-Hill