FACTORS AFFECTING INTERNAL AUDIT EFFICACY IN THE MALAYSIAN PUBLIC SECTOR

A SURVEY ON THE MINISTRY OF FINANCE

Abstract

 The role of internal audit has changed over time in line with globalisation, which is undeniably vital in ensuring that an organisation can maintain its transparency and achieve its ultimate objectives. Such a role notwithstanding, the statistics recorded for corruption has not improved throughout time, especially among public servants in Malaysia. In view of this issue, this present study investigated the factors that determined internal audit efficacy among organisations classified under the Malaysian public sector. The research scope delves into three factors; (1) the relationship between internal and external auditors, (2) management support, and (3) internal auditor independence, which can affect internal audit efficacy. Accordingly, 103 internal auditors from the Malaysian Ministry of Finance were selected as respondents. The findings revealed that management support displayed a significantly positive link with internal audit efficacy. Alternatively, the relationship between external auditor and independence posed a positive yet insignificant impact on internal audit efficacy. Notably, this study contributes to the body of literature on internal audit in the context of Malaysian public sector by providing substantial evidence on factors that impact its efficacy. These outcomes should facilitate the organisations to focus on the key elements to enhance internal audit efficacy in their structures.