Open AccessThe Impact of Executive Management on Internal Auditing Quality Under the Agency's Problem: Evidence From Egypt
Author(s) -
Osama Wagdi,
Amira Hasaneen,
Madyha Metwally
Publication year - 2019
Publication title -
international journal of accounting and financial reporting
Language(s) - English
Resource type - Journals
ISSN - 2162-3082
DOI - 10.5296/ijafr.v9i4.15498
Subject(s) - internal audit , accounting , business , internal control , corporate governance , earnings management , chief audit executive , audit , operational auditing , joint audit , finance , earnings
The study provides a framework for determinants of an impact of Executive Management on internal auditing quality according to eight dimensions (1) leadership style of executive management, (2) Organizational Culture, (3) operation cost of internal auditing, (4) providing information and disclosure for internal auditor (5) cooperation and facilitation from executive management (6) the attitude of executive management of earnings management, (7) the attitude of executive management for creative accounting and (8) professional ethics of executive management. The population of the study is Egyptian manufacturing firms listing at EGX and their employees. Accordingly, the number of received questionnaires was 392 from 28 firms in the first half of 2019 but the financial reports for 2018. The study found the impact of executive management on internal auditing quality, and it is significant at 0.01 level. According to adjusted R-squared; executive management interprets (97.1%) of an internal auditing quality level. Finally; the current framework of corporate governance need to take into organizational characteristics, as well as the ethical and behavioural variables, with than further controls on the Board of Directors, as well as ensuring the independence of internal audit to maximize the quality of internal audit.