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The Impact of Internal Auditing on Financial Planning in Public Educational Institutions

Author

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  • Tatjana Horvat

    (University of Primorska, Faculty of Management, Slovenia)

  • Bernardka Zvorc

    (Primary School Smarje pri Jelsah, Slovenia)

Abstract

In the study we focused on the primary school, which is the most represented among all of public educational institution. The main document in financial planning is financial plan. It should have mandatory components of the content. Our past studies in Slovenia indicate that the content of financial plans in primary schools is not legally adequate. For this purpose we decided to research the hypothesis that "The internal audit affects on the legally adequacy of the financial plan." This hypothesis was tested with the chi-square test. We seek to determine relationship of two variables, namely, if there is a correlation between the number of audits and legally adequacy of the financial plan in primary school. The results are presented with the contingency table. We surveyed a population of 451 primary schools in Slovenia, of which was on our survey responded 148 or 32.82% of primary schools, which represents our sample. Based on the chi-square test result, which was 1.86 (p = 0.395), we were unable to confirm the connection between the legally adequacy of the financial plan and the frequency of audits. We find that internal auditors are not so consistent in reviewing compliance of institutions with the regulations, otherwise they would have to draw attention to the deficiencies of financial plan contents. In our opinion auditors should introduce checking procedures for verifying the appropriateness of the legally adequacy of contents in the financing plan.

Suggested Citation

  • Tatjana Horvat & Bernardka Zvorc, 2017. "The Impact of Internal Auditing on Financial Planning in Public Educational Institutions," MIC 2017: Managing the Global Economy; Proceedings of the Joint International Conference, Monastier di Treviso, Italy, 24–27 May 2017,, University of Primorska Press.
    • Handle: RePEc:prp:micp17:529-541
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    References listed on IDEAS

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    1. Jeffrey S. Bracker & Barbara W. Keats & John N. Pearson, 1988. "Planning and financial performance among small firms in a growth industry," Strategic Management Journal, Wiley Blackwell, vol. 9(6), pages 591-603, November.
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