IDEAS home Printed from https://ideas.repec.org/a/eco/journ1/2022-03-10.html
   My bibliography  Save this article

Internal Audit Effectiveness and Financial Accountability in the Provincial Treasuries of South Africa

Author

Listed:
  • Modjadji Charlotte Msindwana

    (Turfloop Graduate School of Leadership, University of Limpopo, South Africa.)

  • Collins C. Ngwakwe

    (Turfloop Graduate School of Leadership, University of Limpopo, South Africa.)

Abstract

Provincial Treasuries are responsible for assisting the National Treasury in enforcing compliance with the measures established in the South African constitution, which stipulates public sector expenditure control and transparency. This study aims to examine the relationship between internal audit effectiveness and financial accountability in the Provincial Treasuries of South Africa. The theoretical inclination is on the stewardship theory. The research is based on a quantitative approach and draws secondary data on internal audit and financial performance from the nine provincial treasuries of South Africa. Analyses were done using the fixed effect regression after conduction the Hausman tests, Augmented Dickey-Fuller tests (ADF) and Philips Perron (PP). Findings indicate that internal audit can enhance financial accountability across all the expenditure programmes of provincial treasuries in South Africa. Government departments should embrace internal audit as a monitoring tool to evaluate financial accountability and service delivery performance, but not as a punitive initiative. In addition, educational training of internal audit staff can be very effective in achieving government financial control. The paper provides a veritable case study to higher institutions regarding educational qualification versus experience implications on public sector internal audit and accountability; it also offers an agenda for further research.

Suggested Citation

  • Modjadji Charlotte Msindwana & Collins C. Ngwakwe, 2022. "Internal Audit Effectiveness and Financial Accountability in the Provincial Treasuries of South Africa," International Journal of Economics and Financial Issues, Econjournals, vol. 12(3), pages 86-96, May.
  • Handle: RePEc:eco:journ1:2022-03-10
    as

    Download full text from publisher

    File URL: https://www.econjournals.com/index.php/ijefi/article/download/13017/6748
    Download Restriction: no

    File URL: https://www.econjournals.com/index.php/ijefi/article/view/13017
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Mpofu, Mthokozisi & Kendrick Hlatywayo, Clifford, 2015. "Training and development as a tool for improving basic service delivery; the case of a selected municipality," Journal of Economics, Finance and Administrative Science, Universidad ESAN, vol. 20(39), pages 133-136.
    2. Dessalegn Getie Mihret & Aderajew Wondim Yismaw, 2007. "Internal audit effectiveness: an Ethiopian public sector case study," Managerial Auditing Journal, Emerald Group Publishing, vol. 22(5), pages 470-484, May.
    3. Aaron Cohen & Gabriel Sayag, 2010. "The Effectiveness of Internal Auditing: An Empirical Examination of its Determinants in Israeli Organisations," Australian Accounting Review, CPA Australia, vol. 20(3), pages 296-307, September.
    4. Mu’azu Saidu Badara & Siti Zabedah Saidin, 2013. "The Relationship between Audit Experience and Internal Audit Effectiveness in the Public Sector Organizations," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 3(3), pages 329-339, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mu’azu Saidu Badara & Siti Zabedah Saidin, 2013. "The Journey so far on Internal Audit Effectiveness: A Calling for Expansion," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 3(3), pages 340-351, July.
    2. Popoola, Oluwatoyin Muse Johnson & Ahmad, Ayoib B Che & Kehinde, Oyewumi Hassan, 2016. "Determinants of Internal Audit Task Performance in Nigerian Tertiary Institutions: A Conceptual Approach," MPRA Paper 75944, University Library of Munich, Germany.
    3. Abbas, Asad, 2023. "Internal Audit Effectiveness and Its Determinant Factors in Commercial Banks of Ethiopia: The Case of Bale Robe Town," OSF Preprints aktqg, Center for Open Science.
    4. Amad Rashid & Basariah Salim & Halimah Nasibah Ahmad, 2021. "Internal Audit Effectiveness and Audit Committee Characteristics:Empirical Evidence from Pakistan," iRASD Journal of Management, International Research Alliance for Sustainable Development (iRASD), vol. 3(1), pages 1-13, june.
    5. Basu Garg, 2021. "Brand awareness and preferences of rural youth for FMCG: An empirical study of district Bilaspur in Himachal Pradesh," Indian Journal of Commerce and Management Studies, Educational Research Multimedia & Publications,India, vol. 12(2), pages 14-22, May.
    6. George Tackie & Edward Marfo-Yiadom & Sampson Oduro Achina, 2016. "Determinants of Internal Audit Effectiveness in Decentralized Local Government Administrative Systems," International Journal of Business and Management, Canadian Center of Science and Education, vol. 11(11), pages 184-184, October.
    7. Prem Lal Joshi, 2021. "Which factors affect the internal audit effectiveness in India?," Indian Journal of Commerce and Management Studies, Educational Research Multimedia & Publications,India, vol. 12(2), pages 01-13, May.
    8. Stéphane Lhuillery & Marion Tellechea & Stéphanie Thiery, 2021. "Open innovation in managerial innovation: the case of internal audit," Working Papers of BETA 2021-19, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    9. Mu’azu Saidu Badara, 2013. "Impact of the Effective Internal Control System on the Internal Audit Effectiveness at Local Government Level," Journal of Social and Development Sciences, AMH International, vol. 4(1), pages 16-23.
    10. Obal Usang & Basariah Salim, 2016. "Dimensions of Internal Audit Quality and Performance of Local Governments in Nigeria," Asian Social Science, Canadian Center of Science and Education, vol. 12(4), pages 1-28, April.
    11. Happyson Bimha & Patronella Bimha & Sibusiso Makhanya, 2021. "Risk assessment of coronavirus disease lockdown on psychosocial support delivery:Eswatini caregivers’ perspective," Indian Journal of Commerce and Management Studies, Educational Research Multimedia & Publications,India, vol. 12(2), pages 38-52, May.
    12. Hamza Mohammad Alqudah & Noor Afza Amran & Haslinda Hassan, 2019. "Extrinsic Factors Influencing Internal Auditors’ Effectiveness in Jordanian Public Sector," Review of European Studies, Canadian Center of Science and Education, vol. 11(2), pages 1-67, December.
    13. Mustafa TAYTAK & Murat AYDIN, 2020. "Efficiency in Internal Auditing: A Study of Turkish Public Administration," Sosyoekonomi Journal, Sosyoekonomi Society, issue 28(45).
    14. repec:ers:journl:v:volumexxi:y:2018:i:issue4:p:426-434 is not listed on IDEAS
    15. Alzeban, Abdulaziz & Sawan, Nedal, 2015. "The impact of audit committee characteristics on the implementation of internal audit recommendations," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 24(C), pages 61-71.
    16. Sharifah Nazatul Faiza Syed Mustapha Nazri & Mohd Ikram Abdul Rasib & Salwa Zolkifli, 2019. "The Influence of Competency, Usage of It and Career Expectation on Internal Auditor¡¯s Effectiveness in Ggovernment Linked Companies (GLCs)," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 10(3), pages 337-352, May.
    17. Majid, Hassan, 2023. "Internal Audit Effectiveness and Its Determinant Factors in Commercial Banks of Ethiopia: The Case of Bale Robe Town," OSF Preprints 2xjkd, Center for Open Science.
    18. Awn Metlib Al-Shbail & Turki A. A. Turki, 2017. "A Theoretical Discussion of Internal Audit Effectiveness in Kuwaiti Industrial SMEs," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 7(1), pages 107-116, January.
    19. Nurdiono & Rindu Rika Gamayuni, 2018. "The Effect of Internal Auditor Competency on Internal Audit Quality and Its Implication on the Accountability of Local Government," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 426-434.
    20. Mu’azu Saidu Badara, 2012. "The Relationship between Risk Management and Internal Audit Effectiveness at Local Government Level," Journal of Social and Development Sciences, AMH International, vol. 3(12), pages 389-396.
    21. Alzeban, Abdulaziz & Gwilliam, David, 2014. "Factors affecting the internal audit effectiveness: A survey of the Saudi public sector," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 23(2), pages 74-86.

    More about this item

    Keywords

    Provincial treasury; service delivery; internal audit; wasteful expenditure; unauthorised expenditure;
    All these keywords.

    JEL classification:

    • M4 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M42 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Auditing
    • P34 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Finance
    • P43 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Finance; Public Finance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eco:journ1:2022-03-10. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ilhan Ozturk (email available below). General contact details of provider: http://www.econjournals.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.