Study of the relationship between the organization and the positioning of Internal Audit and its effectiveness

Abstract

Beyond the competence of the auditors, the effectiveness of the internal audit function is heavily dependent on several organizational factors.

This article focuses on this topic by providing a structured narrative review of the scientific literature that has examined the link between the organization and positioning of Internal Audit and its effectiveness.

This research is based on proven conceptual frameworks as well as recent and recognized academic work. It proposes to study three essential dimensions: the independence of the function, the contribution of the audit committee, and the support of senior management.

This study highlights the notion of independence, considered by professional standards as an essential condition for achieving objectivity. One of the determining factors in the quality of internal audit is the functional and hierarchical reporting structure, which directly impacts the autonomy of the audit and influences the quality of its output. The audit committee also plays an important role in evaluating the work of internal audit, thus guaranteeing the relevance of its recommendations.

Like the audit committee, the support of senior management ensures access to resources and strategic data. This support provides the audit function with a positive image and legitimacy in the eyes of those being audited and all stakeholders.

By adopting a critical approach, the literature review indicates that the convergence of these three factors—namely, the independence of the function, its relationship with the audit committee, and the support of senior management—constitutes a major lever for improving the effectiveness, performance, and added value of internal audit.

Classification JEL : M42

Paper type: Theoretical Research