The Impact of the Organization’s Internal Factors on the Effectiveness of Internal Auditing: A Field Study at Joint-Stock Companies Operating in the Republic of Yemen

Abstract

The study aimed to identify the impact of organization’s internal factors on the effectiveness of internal auditing of joint-stock companies operating in the Republic of Yemen. To achieve this objective, (252) questionnaires were distribution to a purposive sample (24) companies, represented by the Administration of Internal Audit, Risk Management and Audit Committees, but only (115) were valid for analysis. The study findings revealed a positive impact of the organization’s internal factors on the effectiveness of internal auditing, and a high statistically significant positive impact of the factor of audit committees’ responsibility on achieving the effectiveness of internal auditing, followed by the factor of the internal audit independence. The findings also revealed that there is no impact of the factor of Internal auditing volume and senior management support on internal auditing. Moreover, based on the respondents' point of view, the findings revealed that the most dimensions related to the effectiveness of internal audit are the objectives related to internal control, objectives related to governance, and objectives related to risks. In light of these findings, the study recommends that the senior management of joint-stock companies should pay more attention to internal auditing in order to achieve its effectiveness.