RESEARCH_PROPOSAL_PRESENTATION FOR STRATEGIC RESEARCH

For Strategic Research

1. THE COPPERBELT UNIVERSITY SCHOOL OF GRADUATE STUDIES RESEARCH PROPOSAL TOPIC: AN EVALUATION OF THE EFFECTIVENESS OF INTERNAL AUDIT UNITS IN GOVERNMENT MINISTRIES AND DEPARTMENTS BY KEITH CHISOKO STUDENT NUMBER. 12498012 M.Sc ACCOUNTING AND FINANCE

2. OUTLINE OF THE PRESENTATION Introduction S tatement of the problem Research questions Research objectives General Objectives Specific Objectives Scope of the study Significance of the study Interim Literature Review Theoretical Framework Conceptual Framework Hypotheses Operationalization of the Hypotheses Interim Methodology

3. INTRODUCTION The internal audit function is critical for helping to ensure compliance with sound financial management (The World Bank, 2004). Milichamp and Taylor (2012) stated that principles of good corporate governance require that an independent, objective and capable internal audit function is established with a clear mandate to review not only the accounting function but all of the organization including corporate governance itself. The objective of internal audit is to strengthen internal control systems in order to promote transparency and accountability in the use of public resources (Ministry of Finance, 2013). Internal audit is effective if it meets the intended outcome it is supposed to bring about ( Mihret and Yismaw , 2007).

4. STATEMENT OF THE PROBLEM Despite having Internal Audit Units in all the government ministries and departments, public financial mismanagements have been reported every year in the Auditor General ’ s reports. Misappropriation of funds and corruption are now the order of the day in the public sector in all countries due to weak internal control systems (Van Gansberghe , 2005). It is in this regard that the researcher decided to undertake a research study to evaluate the effectiveness of internal audit units in the government ministries and provinces in Lusaka Province.

5. RESEARCH QUESTIONS What is the nature, scope and quality of work that internal auditors perform? To what extent does senior management provide support to internal auditors? To what extent are the internal audit units in the line ministries and departments independent?

6. RESEARCH OBJECTIVES General research objective The overall objective of this research is to evaluate the effectiveness of internal audit functions in the government ministries and departments in Lusaka . Specific research objectives To determine the nature, scope and quality of work that internal auditors perform; To establish the extent to which senior management provide support to internal auditors; To determine the extent to which internal audit units in the line ministries and departments are independent .

7. SCOPE OF THE STUDY The research study will be restricted to the evaluation of the effectiveness of internal audit units in government ministries and departments . It will focus on three determinants influencing internal audit effectiveness, namely; scope and quality of internal audit, management support and organizational setting and independence. It will be confined to government ministries and departments within Lusaka.

8. SIGNIFICANCE OF THE STUDY The findings from the study will contribute to the existing literature for those who will conduct future research in this field or other related areas. The findings from this research will be useful in helping to strengthen internal audit units in government ministries, provinces and spending agencies as well as the private sector.

9. INTERIM LITERATURE REVIEW Glazer and Jaenike (1980) argued that performing auditing work according to internal auditing standards contributes significantly to the effectiveness of auditing. Ridley and D ’ Silva (1997) found in the UK that complying with professional standards is the most important contributor to IA ’ s added value. The IIA, the American Institute of Certified Public Accountants (AICPA) and others have likewise identified organizational independence as crucial to the viability of the internal audit function (Brown, 1983). It is not surprising that management acceptance of, and support for, the internal audit function has long been seen as critical to the success of that function (Sawyer, 1973).

10. THEORETICAL FRAMEWORK The theory of three E’s Effectiveness Efficiency Economic

11. Management Support Financial resources Audit responses Training Organizational setting (Independence) Budgetory status Reporting lines Internal audit quality Standards Planning CONCEPTUAL FRAMEWORK Figure 2: Factors affecting internal audit effectiveness Internal audit effectiveness

12. HYPOTHESES The research study will test the following three hypotheses HO 1 : There is no positive relationship between m anagement support and internal audit effectiveness. HA 1 : There is a positive relationship between management support and internal audit effectiveness. HO 2 : There is no positive relationship between independence of the internal audit unit and internal audit effectiveness. HA 2 : There is a positive relationship between independence of the internal audit unit and internal audit effectiveness. HO 3 : There is no positive relationship between the scope and quality of internal audit work and internal audit effectiveness. HA 3 : There is a positive relationship between the scope and quality of internal audit work and internal audit effectiveness.

13. OPERATIONALISATION OF THE HYPOTHESES 1. Independence ( Organizational setting) Reporting lines Status of internal audit unit in the organization I nternal audit units decides the scope and timing of their work Audit committees 2. Management support Responses to internal audit findings Financial and moral support to internal audit unit Provision of training Implementation of internal audit recommendations 3. Internal audit quality Competence of internal audit staff Availability of adequate qualified staff Audit standard are followed in performing internal audit work

14. INTERIM METHODOLOGY Research Design This will be a descriptive and quantitative study. Blaikie (2000) stated that a descriptive study is one that attempts to answer ‘ what ’ questions ( i.e characteristics of the situation) but does not go in to details to answer the ‘ why ’ or ‘ how ‘ questions. Research Population The target population for this study will be government ministries and departments based in Lusaka Province and all the internal auditors working for the relevant ministries and departments.

15. INTERIM METHODOLOGY Sample design A multistage sampling technique will be used in this study. The first stage will involve the selection of government ministries and departments in Lusaka while the second stage will involve the selection of internal auditors. Data collection process Data will be collected from Internal Auditors through the use of questionnaires. Data analysis process Data for this study will be analyzed using SPSS (Statistical Package for Social Scientists).

16. END OF PRESENTATION THANK YOU FOR YOUR ATTENTION.